UPI Payment Charges: Finance minister Nirmala Sitharaman has said that the central government sees digital payments a public good and that it is not the right time to make them chargeable. The minister also said that through digitisation, India can achieve a level of transparency.
“We (Centre) see digital payments as the public good. We feel that people should be able to access it freely so that the digitisation of the Indian economy becomes attractive. We can also achieve a level of transparency through digitisation,” said the finance minister while addressing an event in New Delhi on Friday.
“Therefore, we still think it is not the right time to make it chargeable. We are more and more pushing toward open digital transactions, digitisation and platforms which can enable great access. The RBI’s recommendation is to a working paper and lets the working paper where it is,” Sitharaman added.
The comments made by the finance minister come days after the Centre said that the government had no consideration to make UPI payments chargeable, after the Reserve Bank of India invited ideas from stakeholders regarding the same.
However, in a late night tweet on Sunday, August 21, the finance ministry said, “UPI is a digital public good with immense convenience for the public & productivity gains for the economy. There is no consideration in Govt to levy any charges for UPI services. The concerns of the service providers for cost recovery have to be met through other means.”
“The Govt had provided financial support for Digital Payment ecosystem last year and has announced the same this year as well to encourage further adoption of #DigitalPayments and promotion of payment platforms that are economical and user-friendly,” it said.
UPI is a digital public good with immense convenience for the public & productivity gains for the economy. There is no consideration in Govt to levy any charges for UPI services. The concerns of the service providers for cost recovery have to be met through other means. (1/2)
— Ministry of Finance (@FinMinIndia) August 21, 2022
“UPI as a funds transfer system is like IMPS. Therefore, it could be argued that the charges in UPI need to be similar to charges in IMPS for fund transfer transactions. A tiered charge could be imposed based on the different amount bands,” said the central bank.
However, it had also issued a disclaimer on the same. “At this stage, it is reiterated that the RBI has neither taken any view nor has any specific opinion on the issues raised in this discussion paper,” said the RBI in the discussion paper.
“If charges are introduced, should they be administered (say, by RBI) or be market determined,” the RBI asked in the discussion paper.