Starting April 1, 2023, the National Payments Corporation of India (NPCI) will charge an interchange fee ranging between 0.5% and 1.1% for using prepaid payment instruments (PPIs) where transactions worth is over Rs 2,000. The fee will vary depending on the merchant category.
The NPCI has permitted PPI wallets to be part of the UPI ecosystem. With this addition to UPI, customers have the choice of using any bank accounts, RuPay Credit card and prepaid wallets on UPI-enabled apps.
These charges are not to be confused with the bank-account-to -bank-account-based UPI payments which have been in practice so far.
“The interchange charges are only applicable for the PPI merchant transactions, and there is no charge to customers, and it is further clarified that there are no charges for the bank- account-to-bank-account-based UPI payments (i.e. normal UPI payments),” the NPCI said in a statement.
NPCI data show over 8 billion transactions are processed free for customers and merchants every month.
