# UPI to charge Rs 2 plus tax on large payments from April

2026-09-19T09:26:53+00:00 | Governance | Indian Opinion Desk

Corroboration: 1 independent outlet

Digital payments via Unified Payments Interface (UPI) will incur a charge from 1 April 2025. A fee of Rs 2 plus 18% GST will apply on transactions above a certain threshold paid through prepaid instruments such as wallets. For a Rs 100 payment, the charge is about Rs 2.36 after tax, the same for a Rs 1000 payment, but it increases as the amount rises. For a Rs 5,000 transaction, the fee is about Rs 2.95, for a Rs 10,000 payment it becomes Rs 3.71. The charge is capped at a percentage of the transaction value, meaning the fee rises slowly with larger amounts but starts at a fixed minimum. The clarification from the regulator ends uncertainty that had followed the announcement of new charges. Users making small payments will pay a flat charge that does not increase proportionally. The National Payments Corporation of India (NPCI) has mandated this change as part of the recurring payment framework for prepaid wallets. The exact payment threshold and the merchant category affected remain to be notified. The change applies to wallet-based UPI, not directly to bank-account UPI. Consumers are advised to check if their preferred payment app passes this charge on or absorbs it.

## Indian Opinion Analysis

The real-world impact depends on how many merchants pass the charge to the consumer. Under the RBI's 2022 framework, any fee must be transparently disclosed before the transaction is completed. Banks and payment aggregators have lobbied for this change for years, arguing that free UPI is unsustainable. The National Payments Corporation of India (NPCI) sets the interchange rules that allow this fee. If large merchants absorb the cost, the change may go unnoticed by most users. The first major test will be whether any app or bank publically announces the MDR it charges.

## Coverage

- telugu360.com <https://www.telugu360.com/video-pi-charges-explained-how-much-extra-will-you-pay-upi-%E0%B0%8E%E0%B0%82%E0%B0%A4%E0%B0%95%E0%B1%80-%E0%B0%8E%E0%B0%82%E0%B0%A4-%E0%B0%85%E0%B0%A6%E0%B0%A8%E0%B0%82-%E0%B0%9A%E0%B0%BE/>

Tags: GST, NPCI, RBI, UPI
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