Now Reading: UPI may reintroduce fees for merchants, costs likely to hit customers
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UPI may reintroduce fees for merchants, costs likely to hit customers
UPI may reintroduce fees for merchants, costs likely to hit customers
NBPPL, the company that runs UPI, may bring back a small fee on merchant payments. This fee, called MDR, is currently zero for UPI transactions up to Rs 2,000. Banks and fintech…
The Story in Brief
NBPPL, the company that runs UPI, may bring back a small fee on merchant payments. This fee, called MDR, is currently zero for UPI transactions up to Rs 2,000. Banks and fintech firms have been pushing for it to cover costs. The final decision rests with the RBI and the government. If approved, merchants will pay 0.1 percent to 0.3 percent per transaction. But experts say those costs will likely be passed on to customers through higher prices or fewer discounts. UPI now handles more than 10 billion transactions a month.
The Indian Opinion
The narrative that UPI must remain free forever is both unrealistic and populist. No payment system in the world works without some revenue. Banks and payment firms are not charities. They need to cover costs of infrastructure, security, and innovation. The real test is not whether a small fee is imposed or not, but whether the ecosystem becomes more efficient and competitive so that the fee is negligible. Squabbling over a few paise per transaction distracts from the larger goal of deepening digital payments while ensuring sustainability.
Source: ndtvprofit.com
This story was synthesised by AI from the source linked above.
