UPI Transactions: Now UPI will not be free, charges will be levied on every transaction

The Reserve Bank of India (RBI) has indicated that there may be charges on UPI transactions, as the system needs to be made financially sustainable. Currently, the government is giving subsidies. But, this system cannot last for long. The RBI governor said that expenses will have to be taken care of along with making digital payments secure.

UPI Transactions: The Reserve Bank of India (RBI) has given a big hint. The era of completely free digital transactions may soon end. Despite UPI (Unified Payments Interface) continuously making new records, RBI Governor Sanjay Malhotra has explained the reason behind this. He has stressed the need to make the system financially sustainable. The RBI Governor said that it is important to make this system financially sustainable. He said that currently there is no charge on UPI. The government is giving subsidy to banks and other companies so that this system remains free. But, this cannot continue for a long time. Therefore, there is a possibility of charging on UPI.

This statement of the RBI Governor is very important in view of the increasing use of UPI. Transactions through UPI have doubled in the last two years. Now more than 60 crore transactions are taking place daily.

Sanjay Malhotra said in a program of Financial Express, ‘Payment and money are lifelines. We need a system that is better in every way. Right now there is no charge. The government is giving subsidy to banks and other stakeholders in the UPI payment system. Obviously, some cost will have to be paid.’ This means that the cost of running UPI will have to be borne by someone.

Expenses will have to be taken care of

The RBI governor also said that India is committed to making digital payments easy and secure. But, to run it for a long time, expenses will have to be taken care of. He said, ‘Expenses will have to be paid. Someone will have to bear the cost.’

Sanjay Malhotra also clarified that the decision whether to continue the current policy of MDR (Merchant Discount Rate) or not is to be taken by the government. MDR is the charge that merchants pay to the bank when a customer makes a payment by card or UPI.

Sanjay Malhotra also talked about the merger of public sector banks. He said that the mergers that have taken place earlier have given ‘good results’. In future, banks will be merged only when it will benefit financially.

What does this mean?

The Reserve Bank of India (RBI) now wants to make UPI financially self-reliant. Instead of being completely dependent on government subsidy. The simplest meaning of this is that in future user charges may be levied on UPI transactions. The RBI Governor’s statement that ‘someone has to bear the cost’ indicates this. This fee can be very low. But, going forward, it will mark the end of the era of ‘completely free’ transactions.

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