The Treasury Department said on Sunday that United Payments Interface (UPI) is a digital public good and that the government does not consider it to levy levies on it.
This statement allays fears arising from the RBI’s discussion paper on charges in the payment system, which suggests that UPI payments may be subject to tiered charges based on different amount brackets.
Currently, there are no charges for transactions made through UPI.
“UPI is a digital public good with tremendous convenience to the public and productivity gains to the economy. The government is not considering charging fees for UPI services. The service providers’ concerns for cost recovery need to be addressed in other ways,” the ministry said. Finance in a tweet.
UPI is a digital public good with enormous convenience for the public and productivity gains for the economy. There is no consideration in the government to charge for UPI services. Service providers’ concerns about cost recovery need to be addressed in other ways. (1/2)
— Ministry of Finance (@FinMinIndia) August 21, 2022
The RBI discussion paper published earlier this month states that UPI as a money transfer system is similar to IMPS and therefore it could be argued that the charges in UPI should be comparable to the charges in IMPS for money transfer transactions.
“The government provided financial support to the #DigitalPayment ecosystem last year and has announced it this year to encourage the continued adoption of #DigitalPayments and the promotion of payment platforms that are economical and easy to use,” another tweet read.
As of January 1, 2020, the government has made a zero-load framework for UPI transactions mandatory. This means that the costs in UPI are nil for both users and sellers.
(Except for the headline, this story has not been edited by NDTV staff and has been published from a syndicated feed.)