The Reserve Bank of India (RBI) has reiterated that Unified Payments Interface (UPI) transactions will continue to remain free for users, with no charges being imposed at present. RBI Governor Sanjay Malhotra made the clarification on Wednesday (September 1) during a post-policy press conference, addressing speculation and concerns that fees might be introduced on digital payments in the near future.
Governor Malhotra’s statement reinforces both the government and the central bank’s long-standing commitment to keeping UPI a zero-cost platform in order to drive financial inclusion and encourage the mass adoption of digital transactions across India.
The assurance comes at a time when UPI continues to set new benchmarks in transaction volumes, solidifying India’s position as the world’s largest real-time payments market. Millions of users and merchants rely on the platform daily for instant money transfers, bill payments, and purchases, making it the backbone of India’s digital economy.
While UPI has remained free for users since its inception, debates have persisted over the financial sustainability of this model. Governor Malhotra himself had earlier admitted that “there are costs (associated with UPI transactions), and they need to be paid for by someone,” hinting at the possibility that the free model might not be sustainable forever.
However, in his latest remarks, he underlined that no such changes are currently under consideration. “There are no plans to levy charges on UPI transactions at this point,” Malhotra clarified, putting to rest fears of an imminent shift.
Under the existing legal framework, including the Payment and Settlement Systems Act, UPI platforms are not permitted to levy fees on either users or merchants. This aligns with the government’s broader objective of creating a less-cash, digitally empowered economy by ensuring low-cost access to financial services.
The RBI has consistently worked in tandem with the government to ensure that digital payments remain accessible to all sections of society, particularly small merchants and rural consumers who might be deterred by transaction costs.
For now, the status quo ensures that both fintech companies and end-users can continue to operate in a stable environment. Analysts say the RBI’s confirmation will provide much-needed clarity to the sector, encouraging further innovation and adoption without the fear of additional costs.
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