The trajectory of UPI payments via applications like Paytm and PhonePe is going to change from April 1, 2023. It is being said that the users of UPI will have to pay a charge of 1.1% on payments above Rs 2,000 while using Prepaid Payment Instruments (PPI). The National Payments Corporation of India (NPCI) has suggested that the PPI fees will be applied to all the merchant transactions created via UPI (Unified Payment Interface) starting from April 1.
The same information has been released to the masses. It has also been mentioned in the circular that NPCI will review all the charges on or before September 30, 2023. Prepaid Payment Instruments (PPI) consist of online wallets like Amazon Pay, and pre-paid gift cards. Another major thing to mention here is that the upper limit of transactions will be 1.1%.
According to the provided information, the transaction charge will range between 0.5 percent to 11 percent. For example, the users will have to pay a 0.5 percent charge for fuel purchases, 0.7 percent for education, telecom, agriculture, and post office, 0.9 percent for supermarkets, and 1 percent for insurance, railways, and mutual funds. Nonetheless, the charges will not be applicable to peer-to-peer and peer-to-merchant (P2M) transactions.
As per the industry experts, it has been said that the payment providers have been waiting for the charges for a long time. The reason behind it is that there are some serious costs involved in providing the services that were being provided without any cost until now. The merchants who will have ticket items above the value of Rs 2,000 will not be that happy with the way charges are transferred to the end customer. The latest structure of the payments will be reviewed by NPCI on or before September 30, 2023.
