The Central Government is planning a new rule for UPI payments above Rs 2,000. According to reports, a merchant fee may be introduced on such transactions. However, the proposal is still under discussion and no final decision has been taken.
If the new rule is approved, it will apply only to payments made to shops, businesses and merchants. People using UPI to send money to friends or family will continue to make free transactions.
Reports say the government is considering a fee of 0.25 percent to 0.4 percent on merchant payments above Rs 2,000. The fee will be paid by the merchant, not by the customer. But some businesses may increase product prices to cover the extra cost.
At present, UPI payments are completely free. The government removed merchant charges in 2020 to encourage digital payments. Since then, UPI has become the most popular payment method in India.
Banks and payment companies have been requesting the government to bring back a small merchant fee. They say they spend a lot of money on running the payment system, improving security and preventing fraud. They believe a small fee will help support these services.
The government is expected to discuss the proposal with banks and other stakeholders before taking a final decision.
For now, there is no change. All UPI payments continue to remain free under the existing rules.
This post was last modified on 5 August 2026 11:19 am
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