Charges rate of 1.1% using the PPI on the UPI for merchants transactions will be starting April 1, 2023



Starting April 1, 2023, merchants using the Payment Product Interface (PPI) on the Unified Payments Interface (UPI) for transactions over Rs 2,000 will be charged at a rate of 1.1%. This change was announced by the National Payments Corporation of India (NPCI) in March 2023, and it has implications for both merchants and consumers.


The UPI is a real-time payment system that enables interbank transactions using a mobile device. PPIs are digital wallets that are authorized by the Reserve Bank of India (RBI) and can be used for transactions such as bill payments, online shopping, and peer-to-peer transfers. The introduction of this new charge is aimed at incentivizing the use of other digital payment modes, such as credit and debit cards, for high-value transactions.

For merchants, this means that they will have to factor in this additional cost when accepting UPI payments. While the charge may seem small, it can add up quickly for high-value transactions. As a result, merchants may look to encourage their customers to use alternative payment modes, such as credit and debit cards or other digital wallets that are not subject to this charge.

Consumers may also feel the impact of this new charge, especially if they frequently make high-value transactions using UPI. While the charge may not be significant for a one-off transaction, it can add up over time. As a result, consumers may also be incentivized to use alternative payment modes.

While this new charge may cause some initial disruption, it is important to remember that it is aimed at promoting the adoption of digital payments and reducing the reliance on cash. The move towards a cashless economy in India.

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