New Delhi (India), 29th March 2023: From April 1, UPI transactions made using prepaid payment instruments (PPI) will incur an interchange charge of up to 1.1%, according to the National Payments Corporation of India (NPCI).
Users are uncertain as to who will be charged for these transactions and which payment methods will be chargeable, even though the fee will be applied to payments amounting over 2,000.
This interchange fee will not apply to payments made via UPI to friends, relatives, or anyone else, or to a merchant’s bank account.
Peer-to-peer and peer-to-peer-merchant transactions are essentially unchanged.
Through UPI, you will be able to transfer money free of charge from your bank account to the bank account of a recipient or a merchant.
A PPI payment made through UPI entails a transaction carried out through a wallet, such as the Paytm wallet, using a UPI QR code.
For instance, if you have money in your Paytm Wallet and want to use a merchant’s UPI QR code to make a purchase, an interchange fee of up to 1.1% will be charged on transactions over 2,000.
The interchange fee will be charged by the receiver bank/payment service provider to the merchant. Users will not have to pay this fee unless wallet providers like PhonePe, PayTM and others pass the charges to users.
