Millions of digital payment users received official reassurance as the Ministry of Finance notified amendments to the Payment and Settlement Systems Act, guaranteeing that transactions up to Rs 2,000 and all RuPay debit card payments will continue to attract zero fees. The gazette notification under Section 10A makes it legally binding that neither banks nor financial intermediaries can extract direct or indirect charges from individuals sending or receiving money through these designated methods. Answering public queries regarding payments exceeding the Rs 2,000 mark, Finance Minister Nirmala Sitharaman clarified during a parliamentary session that the amended legislation ensures UPI users remain entirely free from transaction fees or taxes. She reassured the public that micro-businesses, local vendors, and taxi operators will not shift any charges onto ordinary citizens, highlighting that future commercial considerations will strictly involve merchant-end adjustments. The policy adjustment marks an evolution in India’s digital payment ecosystem by removing the strict historical ban on the Merchant Discount Rate, a tool initially frozen in 2020 to fast-track digital adoption. Because processing record-breaking transaction volumes demands heavy investments in backend infrastructure and cybersecurity—costs traditionally subsidized by the government and absorbed by payment operators—the updated framework paves the way for sustainable funding. Despite these legal provisions allowing for potential future fees, officials emphasized that no changes have been enforced yet, and the final decision will be carefully orchestrated by the NPCI-led UPI Steering Committee when appropriate.
Are UPI Transactions Over Rs 2,000 Going to Be Charged? Here Is What the Government Said
