TL; DR (tap to expand)
- PhonePe is facing backlash for charging a ₹100 inactivity fee on dormant wallets while making it difficult for users to close them.
- Users say they are being asked to add money, complete KYC, and wait 24 hours before they can proceed with wallet closure, even if they never actively used the service.
- The policy has sparked widespread criticism on X, with many users calling the practice unfair and saying they plan to switch to alternative UPI apps.
PhonePe is facing strong backlash for charging a ₹100 inactivity fee on wallets that remain unused, while simultaneously making it very hard for users to close their accounts. Many users, including those who never actively used or even knew they had a PhonePe Wallet, are being forced to add money just to exit the service.
The company sends automated warnings stating that a ₹100 fee will be levied every 3 months if the wallet stays inactive. At the same time, when users request to close their wallets, PhonePe’s support blocks the request if the balance is less than ₹1. Users are then told to first add money to cross the ₹1 mark and retry after 24 hours. This combination has left many people feeling trapped in wallets they no longer want or never wanted.
How PhonePe’s Policy Works
PhonePe has set up a system where low or zero-balance wallets cannot be closed easily. Support responses follow a standard pattern: if the wallet balance is below ₹1, closure is denied. The user is instructed to deposit money so the balance becomes more than ₹1, wait for 24 hours, and then try again.
In some cases, users have also been asked to complete KYC before they can close the wallet. While this is happening, PhonePe continues to send messages warning about the ₹100 inactivity fee. The company is essentially pressuring users to either keep using the wallet or pay to keep it inactive.
Users Are Being Forced to Add Money to Close Their Wallets
Several users on X have shared their experiences of being stuck in this process.
@matj90s on X tried to close their PhonePe Wallet but received this response from support: “Unfortunately, we cannot process your request as your Wallet balance is less than ₹1. To proceed, please add more money so that the balance is more than ₹1, and then retry after 24 hours.” Even after raising a ticket, the closure was not allowed without topping up.
@Am1day also faced the same issue. He wanted to close his wallet but was told he could not do so because his balance was below ₹1. Support asked him to add money and attempt closure again after 24 hours.
Another user, @desi_comic, directly called out the tactic. He said PhonePe had credited ₹1 into his wallet and was now threatening a ₹100 fee if he didn’t use it. He pointed out that he cannot delete his wallet or account without first using that money.
Inactivity Fee Warnings Are Driving Users Away
PhonePe has been sending messages like this to users: “Your Wallet has been inactive for a while. A Rs.100 inactivity fee will be levied soon. Start using your Wallet today to avoid future charges.”
User @TheReal_YRJ on X responded to one such message by saying that if a product has to threaten users with a fee just to stay relevant, it’s time to delete it altogether. Others suggested switching to alternative apps like Google Pay or Super Money.
Many Users Never Wanted the Wallet in the First Place
A major complaint is that many people never actively created or used a PhonePe Wallet. @abhinav on X explained that several users don’t even know they have a wallet. To close it, they are first forced to activate it through KYC, and then still face the low-balance barrier. He questioned why PhonePe makes it so complicated for users who never wanted the wallet.
Users Are Unhappy and Planning to Switch
The reaction from users has been overwhelmingly negative. Most people sharing their experiences have expressed clear frustration and anger. Many have openly stated that they are ready to stop using PhonePe and switch to other UPI apps.
Users are actively recommending alternatives and some have already posted about uninstalling the app. The general sentiment is that PhonePe is using unfair tactics to retain users and collect fees from dormant wallets. Because of this, a growing number of people are losing trust in the platform and are willing to move to competitors.
PhonePe’s decision to charge a ₹100 inactivity fee while making wallet closure difficult for low-balance accounts is being widely seen as a deliberate strategy to keep users engaged against their will. This approach has triggered strong backlash, with many users now looking to delete the app and switch to other services.
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