Although it wasn't particularly addressing UPI transactions, the document covered a number of electronic payment systems, including Immediate Payment Service (IMPS), the National Electronic Funds Transfer (NEFT) system, and the Real Time Gross Settlement (RTGS) system.
Digital Desk: Regarding claims
that it could charge extra fees for UPI payments, the Central Government has
clarified its position. UPI (Unified Payments Interface) is a "digital
public utility," according to a series of tweets from the Ministry of
Finance published on Sunday, and there are no intentions to charge for UPI
services. According to the tweet, the government has financially supported the
country's digital payments ecosystem. It also noted that alternative funding
mechanisms must be explored to meet the expense of recovery. The ministry went
on to state that it has also made plans to offer support this year to encourage
more people to adopt electronic payments.
In response to rumours that UPI
transactions might be charged an additional cost to support the payments
infrastructure, the remark was made. The Reserve Bank of India has also asked
for comments on the topic, according to a discussion paper released on August
17th. Although it wasn't particularly addressing UPI transactions, the document
covered a number of electronic payment systems, including Immediate Payment
Service (IMPS), the National Electronic Funds Transfer (NEFT) system, and the
Real Time Gross Settlement (RTGS) system.
The report demanded that the
government maintain the zero-MDR (merchant discount rate) policy, which is
still in place for RuPay and UPI transactions. Service providers assert that
systems can be improved by tying an MDR fee to digital payments.
The Payments Council of India
(PCI), the trade group for the country's digital payments ecosystem, requested
in writing to the government that the zero-MDR policy for UPI and Rupay debit
cards be reversed before the introduction of the Union Budget 2022. MDR (0.4 to
0.9%) is currently assessed on Visa and Mastercard debit cards, and it is
divided between the issuer banks and acquirer.
In its paper on UPI, the RBI
asked for feedback on whether it should be treated differently from debit cards
from Visa and Mastercard. The administration declared in the tweet that it is
in favour of "economical and user-friendly" digital payments.
