The statement from RBI Governor Sanjay Malhotra reaffirms the government‘s and RBI‘s position that UPI should remain a free platform in order to promote the nation’s broader use of digital payments.
During the post-policy news conference on Wednesday, Governor Sanjay Malhotra said that the Reserve Bank of India does not currently have any plans to charge for UPI transactions. He underlined that UPI would stay free for users under the current policy in response to worries about potential fees associated with digital payments.
Governor Malhotra’s remarks support the government‘s and RBI‘s position that UPI should remain a free platform in order to promote the nation’s broader use of digital payments. As UPI transactions continue to reach all-time highs, the statement solidifies India‘s standing as the biggest real-time payments industry globally.
Shortly after the Governor’s remark, the share price of Paytm (One 97 Communications) surged by more than 2% and was trading at Rs 1,147 on the NSE in the early afternoon.
Malhotra’s remarks coincide with fresh conjecture on the viability of UPI’s cost-free business strategy. In the past, he conceded that UPI may not be free indefinitely and said that “there are expenses (related with UPI transactions), and they need to be paid for by someone.” He did, however, stress today that no modifications are being made at this time.
The government and RBI want to encourage digital payments, and UPI has long been a mostly free platform across the ecosystem. Currently, it is illegal for users or merchants to charge fees for UPI transactions under the Payment and Settlement Systems Act and associated regulations.
In response to public concerns after previous remarks, the finance ministry also said in parliament earlier this year that there is currently no intention to levy UPI transaction fees.