The deets: how will the new UPI charges work?



Apr 3, 2023

Before we dive in, here’s a quick note: you probably don’t need to worry about the UPI charges that were recently announced. Unless you’re a business owner who accepts payments over ₹2k via UPI often.

Now that that’s out of the way, we’ll go into what exactly the UPI charges are about. Let’s start with a wee bit of background. 

(👀 scroll till the end for a sneak peek on what’s coming on the Power Card)

🚀 As we all know, UPI (Unified Payments Interface) has been a game-changer for digital payments in India. It’s real time, it’s quick, it’s easy. Transferring money to friends, merchants, and anyone really, has never been smoother. As users of UPI, this has been revolutionary. Bank to bank transfers in a matter of seconds, and completely free of any charges? We love it! Furthermore, UPI as a method also started to gain popularity on prepaid instruments (PPI), such as wallets and prepaid cards.

🍕 Now, nothing changes on the regular bank to bank transfers via UPI (known as P2P, or peer to peer transactions). Paying a friend your share for lunch? Free. Paying your therapist for a session? Free. Paying your colleague for another colleague’s gift? Also free.

So, what’s changing then?

💳 NPCI, the organisation that runs UPI, announced that UPI transactions done on prepaid instruments (PPI) for amounts ₹2k and more will now cost some merchants up to 1.1% in fees - starting April 1st. Think of this as something similar to the fees a business needs to pay to process a credit card payment. When you use UPI to pay ₹2k+  from a digital wallet or prepaid card, the business you are paying bears a fee (called “interchange”).  This DOES NOT affect you as the customer.

Hope this helps! 

Sneak peek: we will soon be enabling UPI on the Power Card, so you can scan and pay using your Power Card balance. Stay tuned!

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