UPI Payment Rules Update: What You Need to Know About the Changes Starting April 1
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ew UPI Payment Rules Effective from April 1: Starting April 1, certain Unified Payments Interface (UPI) transactions over ₹ 2,000 will incur an interchange fee of 1.1%. However, this fee only applies to merchants. The National Payments Corporation of India (NPCI) has clarified that there will be no charge for regular UPI payments made between bank accounts.
Key Facts About the Updated UPI Payment Rules
To better understand the changes to UPI payment rules, here are a few key points:
The NPCI confirmed that the interchange fees apply only to prepaid payment instruments (PPI) merchant transactions, and customers will not be charged.
Interchange fees vary across different merchant categories, ranging from 0.5% to 1.1%. Additionally, certain categories have a fee cap.
The new interchange fee structure will be implemented on April 1.
This change aims to generate revenue for banks and payment service providers that have been struggling with the high cost of UPI transactions.
The NPCI will review interchange pricing by September 30, 2023.
Interchange fees will not be applied to peer-to-peer (P2P) and peer-to-peer-merchant (P2PM) transactions.
The NPCI has clarified that no charges will be applied to standard UPI payments between bank accounts.
In a statement, the NPCI said, “The interchange charges introduced are only applicable for the PPI merchant transactions and there is no charge to customers, and it is further clarified that there are no charges for the bank account to bank account-based UPI payments (i.e. normal UPI payments).”
Paytm reassured customers on Twitter that they will not be charged extra for using UPI payment mode, stating, “Please be informed that Paytm UPI is free, fast, secure, and seamless. No customer will pay any charges on making payments from UPI either from the bank account or PPI/Paytm Wallet.”
Under the new rules, customers can choose to use any bank account, RuPay Credit card, and prepaid wallets on UPI-enabled apps.
No Extra Cost for Customers
Using UPI Payments Despite the implementation of interchange fees for some UPI transactions, customers can rest assured that there will be no additional cost for normal UPI payments between bank accounts. The new rules are specifically aimed at generating revenue for banks and payment service providers, while ensuring a seamless and secure experience for customers using UPI-enabled apps.
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