The National Payments Corporation of India (NPCI) may request banks not to charge for transactions made through the Unified Payments Interface (UPI).
NPCI came up with this proposal after HDFC Bank, the largest private sector lender, declared that it would charge on transactions done through UPI from July, 10. The bank announced recently that it would charge Rs.3 plus taxes for transactions up to Rs.25,000 and Rs.5 plus taxes for transactions over Rs.25,000 to Rs. 1 lakh made via UPI.
The chief motive behind NPCI’s plan to ask banks not to charge for UPI transactions is to encourage people to make cashless payments instead of cash payments. The whole idea behind the demonetization drive in November 2016 was to promote a cashless economy in India that would help track all transactions and weed out black money from the country. Hence, NPCI, being the nodal agency for digital payments, tries to promote digital transactions among people to build a cashless society in India.
According to Dilip Asbe, the chief operating officer of NPCI, “So far, no bank is charging for UPI transactions but at the same time it is at their discretion to levy a reasonable fee towards person-to person (P2P) transactions for UPI and IMPS (Immediate Payment Service). However, person-to-merchant (P2M) transactions in UPI will remain free to customers as per NPCI guidelines.”
However, banks like SBI, Yes Bank and RBL Bank have stated that they have no such plans to charge customers on UPI transactions.
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