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Starting April 1, 2023, service provider transactions over ₹2,000 finished by way of Prepaid Payment Instrument Wallets (PPI Wallets) on UPI will entice an interchange cost of 1.1%. This has been allowed by National Payments Corporation of India (NPCI) which governs UPI.
However, there will likely be payment to be charged for regular UPI transactions.
The Interchange payment is usually related to card funds to cowl transaction value.
In an announcement, NCPI mentioned as per current regulatory pointers, the PPI Wallets have been permitted to be a part of interoperable UPI ecosystem.
“The interchange charges introduced are only applicable for the PPI merchant transactions. And there is no charge to customers.”
“It is further clarified that there are no charges for bank account to bank account based UPI payment (normal UPI payments),” NPCI mentioned.
Banks remained tight lipped to touch upon this isssue.
Rajsri Rengan, India Head of Development, Banking and Payments, at FIS in an announcement mentioned, ”The new interoperability pointers for pay as you go fee devices introduced by the NPCI is a big step in direction of constructing a extra inclusive and seamless digital funds ecosystem in India.”
“The interoperability of digital wallets and UPI can be a game-changer for the Indian fintech industry, as it opens up new opportunities for innovation, growth, and competition. With greater interoperability between payment systems, consumers will have more choice and flexibility in how they transact with merchants, leading to increased adoption of digital payments and ultimately driving financial inclusion and economic growth,” the assertion mentioned.
“This move will also encourage innovation in the digital payments space, fostering competition and improving the quality of services offered to consumers,” the assertion added.
“We believe this is a positive development for the Indian economy and the banking system as a whole, and we look forward to continuing to support the growth and development of digital payments in India,” the assertion additional mentioned.
Source: www.thehindu.com
