UPI Transaction Charges 2023
Recently, the National Payments Corporation of India (NPCI) announced in a circular that an interchange fee ranging from 0.5% to 1.1% will be charged on transactions done using prepaid payment instruments that are over Rs 2,000.
(PPIs).
Starting on April 1st of 2023, a fee for digital wallet transactions processed over the Unified Payments Interface (UPI) will apply.
The fee will vary depending on the kind of service offered.
For example, 0.5% will be added to payments for fuel, 0.7% will be added to payments for telecom, utilities/post office, education, and agriculture transactions, and 1% will be added to payments for court fees, tax payments, and insurance sales.
PPIs, which are the most widely used apps for UPI transactions, are digital wallets that let users store money and send and receive payments.
Examples of these apps are Google Pay, PhonePe, and Paytm.
Beginning on April 1, the bank of the merchant (the person or business receiving the payment) will pay the bank of the payer the interchange charge anytime they are used to complete a UPI transaction. (the person making the payment).
As a wallet-loading service fee, the PPI issuer will pay the remitter bank roughly 15 basis points.
The merchant, who will be charged this cost, may or may not pass it on to the customers.
Since the majority of transactions made through these applications are currently under Rs 2,000, the majority of PPIs are currently reluctant to do so.
Additionally, if they charge their consumers a price, they risk losing those customers to a rival business that may be ready to pick up the tab instead of the customer.
Paytm has already stated that there will be no charges for users.
Additionally, routine UPI payments, such as those sent from one bank account to another—which, according to the NPCI, account for 99.9% of all UPI transactions—are exempt from this fee.
On the UPI platform, there are 5 crore merchants and around 25 crore unique users.
The UPI processed 753.4 billion transactions in February of this year, totaling Rs. 12.35 lakh crore.
The UPI system is managed by the NPCI, which said that the action was taken to boost UPI interoperability and boost income for banks and payment service providers.
By September 30, 2023, this pricing will be re-evaluated.
UPI
The Unified Payment Interface (UPI) is a real-time fee machine evolved via way of means of the National Payments Corporation of India (NPCI).
It allows users to transfer money from one bank account to another using a mobile phone.
UPI is an instant payment system that enables inter-bank transactions 24×7, 365 days a year.
It was launched in 2016 and has since then become the most preferred mode of payment in India.
How does UPI work?
UPI works on top of the Immediate Payment Service (IMPS) platform, which is a real-time interbank electronic fund transfer service.
To use UPI, you need to link your bank account to a UPI-enabled mobile app.
Once you have linked your bank account, you can create a Virtual Payment Address (VPA), which is a unique identifier that you can share with anyone to receive payments.
To make a payment using UPI, you need to enter the recipient’s VPA, enter the amount to be transferred, and authenticate the transaction using a UPI PIN.
The payment is instantly transferred from your bank account to the recipient’s bank account.
Advantages of UPI:
UPI Instant Transactions:
UPIs enable instant fund transfers, which means that you can send or receive money in real-time.
No need to remember bank details:
With UPIs, you do not need to remember the recipient’s bank account details, such as the account number and IFSC code.
You only need to know their VPA, which is easy to remember.
Secure:
UPIs transactions are highly secure as they are authenticated using a UPIs PIN.
This ensures that only the authorized user can initiate the transaction.
Interoperability:
UPIs are an interoperable platform, which means that you can use any UPI-enabled mobile app to transfer funds to any bank account that is also linked to UPI.
No Transaction Fees:
Unlike other modes of payment, UPIs do not charge any transaction fees.
This makes it a cost-effective option for transferring money.
UPIs have brought a revolution in the way we transfer money.
Its simplicity, convenience, and security have made it the most preferred mode of payment in India.
With UPI, you can transfer money instantly, without any transaction fees, and without the need to remember bank details.
It has made digital payments accessible to everyone and has helped in achieving the goal of a cashless economy.
Charges On UPI Transaction
Transaction Charges
Most UPIs transaction are free of cost, which means that you do not have to pay any fees to transfer money.
However, there are certain types of UPIs transaction for which you may have to pay transaction charges.
For example, some banks may charge a nominal fee for UPI transactions above a certain limit.
These charges vary from bank to bank, and you should check with your bank to know the exact charges.
Merchant Discount Rate (MDR)
Merchant Discount Rate (MDR) is a fee charged by banks to merchants for accepting digital payments.
It is a percentage of the transaction amount and is usually borne by the merchant.
However, in some cases, the merchant may pass on the MDR to the customer.
This is usually the case when the transaction amount is small.
For example, if you are paying for a cup of coffee using UPI, the merchant may ask you to bear the MDR, which is usually around 0.25% of the transaction amount.
Overdraft Charges
Overdraft charges are applicable when you transfer money using UPI, and your account balance is insufficient to cover the transaction amount.
In such cases, your bank may charge you an overdraft fee, which can be quite high.
It is, therefore, important to ensure that your account has sufficient balance before initiating a UPI transaction.
Foreign Transaction Charges
If you are using UPI for international transactions, you may have to pay foreign transaction charges.
These charges are usually levied by the bank and vary depending on the currency and the transaction amount.
UPI Logo
A logo is an essential part of any brand or service as it serves as a visual representation of the brand identity.
It helps people to identify and recognize a brand easily.
Similarly, in the case of UPI, the logo plays a crucial role in building trust and confidence in the users.
As UPI involves transferring money between bank accounts, people need to be sure that they are using a reliable and secure platform.
A well-designed logo can convey the message of trust and reliability to the users, and thus, it is important to have a logo that reflects the values and principles of UPI.
Let’s take a look at some popular logos used by UPI-enabled apps:
1. Google Pay:
The Google Pay logo is a stylized ‘G‘ with colors blue, green, and yellow.
The logo is simple and easy to recognize, and the use of bright colors adds a friendly and approachable vibe to it.
2. PhonePe:
The PhonePe logo features a stylized hand with a violet and white color palette.
The hand symbolizes the ease of making transactions using the PhonePe app, and the green color represents growth, prosperity, and freshness.
3. Paytm:
The Paytm logo is a vibrant shade of blue with a white colored tick in the center.
The color blue signifies trust, security, and stability, while the white tick represents the ease of using Paytm for transactions.
4. BHIM:
The BHIM logo features a blue-colored stylized ‘B’ with the letters “BHIM” written below it.
The color blue represents trust and security, and the use of a single letter ‘B’ in the logo makes it easy to remember.
5. Amazon Pay:
Best UPI App in India
| Sr. No. | PPI Issuer | App Name | Handle Name | Links URL |
|---|---|---|---|---|
| 1 | ICICI Bank Limited | Pockets | @pockets | ICICI Bank Contact Us - Customer Care, Queries & Feedback - ICICI Bank |
| 2 | LivQuik Technology (India) Private Limited | Jupiter Edge | @liv | https://livquik.com/customer-service/?amp |
| 3 | IDFC FIRST Bank Limited | Fampay, First ₹UPI | @idfcbank,@idfcpay | https://fampay.in/contact https://www.idfcfirstbank.com/customer-care |
| 4 | Amazon Pay (India) Private Limited | Amazon | @amazonpay | https://www.amazon.in/hz/contact-us/ |
| 5 | Spice Money Limited | BHIM SpicePay | @spicepay | Spice Money |
| 6 | Eroute Technologies Private Limited | OmniCard | @omni | Contact Us |
| 7 | Transerv Limited | Dhani | @dhani | Customer Care Policy |
| 8 | Bajaj Finance Limited | Bajaj Finserv | @bpaywallet | Reach Us - For Customer Care, Queries, Feedback - Bajaj Finserv |
| 9 | Transcorp International Limited | Cheq | @trans | https://transcorpint.com/contact-us/ |
| 10 | Tri O Tech Solutions Private Ltd. | Fampay | @fam | https://fampay.in/contact |
| 11 | Pine Labs Private Ltd. | Fave, DreamX | @pinelabs | https://www.pinelabs.com/contact-support |
Third Party UPI Apps List
| Sr. No. | TPAP | PSP Banks | Handle Name | Links URL |
|---|---|---|---|---|
| 1 | Amazon Pay | Axis Bank, Yes Bank, RBL Bank | @apl, @yapl, @rapl | https://www.amazon.in/hz/contact-us/ |
| 2 | Bajaj Finserv | Axis Bank | @abfspay | https://www.bajajfinserv.in/reach-us |
| 3 | Bajaj MARKETS (Finserv Markets) | Axis Bank | @abfspay | https://www.bajajfinservmarkets.in/contact-us.html |
| 4 | CoinTab | Federal Bank | @fbl | https://www.cointab.in/contact/ |
| 5 | CRED | Axis Bank | @axisb | Home > Profile > Support > Other Issues > CRED UPI |
| 6 | Fave (Pinelabs) | IDFC FIRST Bank | @idfcbank | https://www.myfave.in/contact |
| 7 | Goibibo | ICICI bank | @icici | https://support.goibibo.com/support/solutions/folders/12000008822 |
| 8 | Google Pay | Axis Bank, HDFC Bank, ICICI, SBI | @okaxis, @okhdfcbank, @okicici, @oksbi | https://support.google.com/pay/india/answer/10084701#zippy=%2Clevel---complaints-registration%2Clevel---grievance-redressal |
| 9 | Groww | Axis Bank | @axisbank | Home > Profile > Help & Support > Payments > Groww UPI |
| 10 | Jupiter Money | Axis Bank Limited | @jupiteraxis | https://jupiter.money/contact/ |
| 11 | Make My Trip | ICICI, IndusInd Bank | @icici, @indus | https://www.makemytrip.com/support/contact-us.php |
| 12 | MobiKwik | HDFC Bank | @ikwik | https://www.mobikwik.com/contact |
| 13 | Phonepe | Yes Bank, ICICI Bank, Axis Bank | @ybl, @ibl, @axl | https://www.phonepe.com/contact-us/ |
| 14 | Samsung Pay | Axis Bank | @pingpay | https://www.samsung.com/in/support/email/ |
| 15 | Slash | ICICI Bank | @icici | https://www.slashpay.app/legal/grievances |
| 16 | slice | Axis Bank | @sliceaxis | https://www.sliceit.com/contact-us |
| 17 | SuperPay (Chintamoney) | Kotak Mahindra Bank | @kmbl | https://www.superpay.money/media |
| 18 | TataNeu | ICICI Bank | @tapicici | Homepage > Top right corner Menu button > Legal > Terms & Conditions |
| 19 | Timepay | The Cosmos Co-Operative Bank Ltd. | @timecosmos | https://www.timepayonline.com/upi-terms-conditions.php?current= |
People Also Ask
UPI stands for Unified Payments Interface.
It is a digital payment system developed by the National Payments Corporation of India (NPCI) to facilitate easy and instant money transfers between bank accounts.
UPI allows users to link their bank accounts to a mobile number and make transactions by using a virtual payment address (VPA).
The VPA acts as an identifier and eliminates the need to share bank account details.
Transactions can be initiated by using a mobile app that supports UPI.
Yes, UPI is considered safe and secure.
Transactions made through UPI are encrypted and protected by multi-factor authentication.
Additionally, UPI transactions are covered by the RBI’s Payment and Settlement Systems Act, 2007.
No, UPI can only be used for domestic transactions within India. It does not support international money transfers.
Yes, there is a limit on the amount that can be transferred using UPI.
The maximum limit per transaction is Rs. 1 lakh.
However, some banks may have their own transaction limits, and users should check with their bank for more information.
Most banks do not charge any fees for using UPI.
However, there may be charges for certain types of transactions or if the transaction limit is exceeded.
No, UPI requires a smartphone and an internet connection to make transactions. However, some banks may offer alternative methods to make UPI transactions, such as through SMS or USSD.
UPI transactions are usually processed instantly, and the amount is transferred to the recipient’s account within a few seconds.
However, in some cases, it may take up to a few hours for the transaction to be completed.
If a UPI transaction fails, the amount will be refunded back to the user’s account within a few days.
Users can also contact their bank’s customer support for further assistance.
Yes, UPI can be used to pay bills, including utility bills, mobile recharge, and DTH recharge. Many service providers have integrated UPI as a payment option, and users can make payments by using their UPI ID or QR code.