Survey says, “Majority of Users May Stop Using UPI If Charged”

According to a survey by LocalCircles, 70% – 75% of UPI users will stop using the UPI service if a transaction fee is added. The survey also states that only 23% of users are ready to pay a transaction fee whereas 73% of them will stop using UPI if a transaction fee is charged. Here’s more about the survery:-

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  • Half of UPI users engage in more than 10 transactions monthly.
  • In August 2022, the RBI issued a discussion paper proposing a tiered fee system for UPI payments.
  • Following the discussion paper by the RBI, the finance ministry said that there were no intentions to impose such fees.
UPI Transaction Over Cash @NewYorkTimes

In India, where people used to prefer cash, UPI digital transactions have become extremely popular. Now-a-days online money transfer scanners are available everywhere in the INDIA, from luxury boutiques to paan shops to small roadside stalls everywhere.

A recent report shows:-

  • In January, the daily number of UPI transactions saw a notable rise, from 39.3 crore to 41.7 crore.
  • UPI transactions in India hit a record high of Rs18.28 lakh crore in February 2024.

Current Scenario

  • UPI is a widely used payment method accessed by mobile phone in India that allow real-time money transfers between personal accounts, banks, and merchant accounts.
  • Prepaid Payment Instruments (PPIs), such as digital wallets (e.g., PhonePe, Paytm, Amazon Pay) that made these UPI transactions possible.
  • Interchange fees are associated with UPI transactions made through PPIs. These fees cover processing, accepting, and authorizing transaction costs.
  • The interchange fee charge is from 0.5% to 1.1% based on the type of service (e.g., fuel payments, post office, supermarkets, insurance).
  • New guidelines introduced in 2024 impose an interchange fee of up to 1.1% on UPI transactions above Rs. 2,000 made through PPIs.

Impact on Users

Personal Transactions: Individuals making personal transactions using UPI are not charged any fees. UPI payments for personal transactions will remain free irrespective of amount.

Merchant Transactions: Merchants accepting payments above Rs. 2,000 using PPIs need to pay an interchange fee.

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I'm Shashank Sharma - who is responsible for writing about technology, specifically Mobile Phone Review at AxpertMedia. I've a strong opinions in Business and Tech [Specially Mobile Phone, Blockchain and SaaS tools]. Moreover, when I'm not busy pursuing my interests, i love cooking up and experimenting with new recipes, flavors.

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