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  1. RBI Governor confirms: No fees on UPI transactions, at least for now

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RBI Governor confirms: No fees on UPI transactions, at least for now

Upstox

2 min read | Updated on October 01, 2025, 15:06 IST

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SUMMARY

RBI Governor Sanjay Malhotra clarified that there is currently no proposal to levy charges on UPI transactions, which account for nearly 80% of retail digital payments in India

The new framework allows customers to transact up to ₹10 lakh in 24 hours for various 'verified merchant' categories. | Image: Shutterstock

The new framework allows customers to transact up to ₹10 lakh in 24 hours for various 'verified merchant' categories. | Image: Shutterstock

Reserve Bank Governor Sanjay Malhotra on Wednesday said there is no proposal to levy any charge on Unified Payments Interface (UPI) transactions, which constitute the bulk of retail digital payments in the country.

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Responding to a query at the post-monetary policy press conference, Malhotra said, “Is there going to be charges on UPI? Well, there is no proposal before us.”

He also said the central bank is examining a proposal to allow lenders to remotely lock mobile phones purchased on credit in case of default in EMI payments.

At the last monetary policy briefing in August, Malhotra had remarked that the UPI ecosystem may not remain cost-free forever, underlining that someone has to bear the operational costs. He had pointed out that while the government is subsidising the system at present, the sustainability of such an arrangement in the long term remains a question.

“There are costs, and these costs have to be paid by someone. Who pays is important but not as important as the fact that someone is footing the bill,” he had said earlier.

Introduced in 2016, UPI now accounts for nearly 80% of retail digital payments in India. Since January 2020, these transactions have been exempt from merchant discount rate (MDR), a fee that banks typically charge merchants for processing digital payments.

In June, the Finance Ministry had categorically dismissed speculation that MDR would be imposed on UPI transactions, terming such reports as “completely false, baseless, and misleading.”

The ministry had also said the government remains committed to promoting digital payments through UPI and urged against creating “needless uncertainty, fear and suspicion” among citizens.

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Upstox
Upstox News Desk is a team of journalists who passionately cover stock markets, economy, commodities, latest business trends, and personal finance.

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