India to introduce fee for UPI instant payments

India’s Unified Payments Interface (UPI), the nation’s flagship instant digital‑payments platform that has operated without user fees since its launch in 2016, is set to introduce charges for certain transactions. The National Payments Corporation of India (NPCI), which manages UPI, announced that from July 1, 2024 merchants processing payments above a specified volume will incur a fee of 0.30 percent plus a fixed charge of ₹0.30 per transaction, while small‑ticket and peer‑to‑peer transfers will remain free.

The fee structure follows a review by the Reserve Bank of India (RBI) aimed at ensuring the long‑term sustainability of the ecosystem and covering the rising costs of infrastructure and fraud mitigation. NPCI officials said the charges will apply only to high‑value or high‑frequency merchants, representing less than 5 percent of total UPI activity, and that the revenue will be reinvested to enhance security and expand services. Industry bodies have welcomed the move as a step toward a more balanced model, while consumer groups caution that any spill‑over costs could affect end‑users. The introduction of fees marks a significant shift for a platform that has driven India’s rapid digital‑payments adoption, signaling a new phase in its evolution.