New Delhi: The Government of India has announced that there will be no direct or indirect bank charges on UPI transactions up to ₹2,000. The clarification is in response to a notification, issued by the Ministry of Finance, pursuant to the Payment and Settlement Systems Act, 2007.
According to the notification, UPI transactions up to ₹2,000 and payments made through RuPay-powered debit cards have been categorised as electronic modes of payment under Section 10A of the Act. Banks and payment system providers are prohibited from imposing charges on individuals making or receiving payments through these modes within the specified limit.
The clarification is expected to provide continued support for small-value digital transactions, including everyday payments made by consumers and merchants. By retaining a no-charge framework for transactions up to ₹2,000, the government has reaffirmed the accessibility of digital payments for routine financial needs.
The notification also brings renewed attention to the regulatory framework governing charges on higher-value UPI transactions. While the government has specified the protection applicable to transactions up to ₹2,000, the precise structure and implementation of any charges on transactions above that threshold would depend on further policy directions.
The move comes as UPI continues to play a central role in India’s digital payments ecosystem. The clarification is likely to be relevant to banks, payment service providers, merchants and consumers as the country continues to expand the use of electronic payment systems.
