UPI Charges: 75% of Users May Quit, Survey Finds
75% of Users Say They Would Stop Using UPI if Charges Are Imposed, According to a Nationwide Survey
UPI: A Popular Payment Platform Facing Potential Charges
Unified Payments Interface (UPI) has emerged as one of the most popular online payment platforms in India, with apps like Google Pay and PhonePe leading the way. However, recent discussions about introducing charges for UPI transactions have sparked significant debate. If such charges are implemented, users may have to pay extra fees for transactions made through these apps. A recent survey conducted by LocalCircles reveals some surprising insights into how this potential change could impact users.
75% of Users May Abandon UPI
According to the survey, nearly 75% of users stated that they would stop using UPI for payments if charges are introduced. This survey, which took place over a six-month period, gathered responses from around 44,000 people across 325 districts in India. Only 22% of respondents indicated that they would continue using UPI despite the additional charges.
Demand for MDR Charges on UPI Payments
Several leading payment apps in India have advocated for the introduction of Merchant Discount Rate (MDR) charges on UPI payments. MDR is a fee that merchants pay for accepting payments through digital methods, such as debit or credit cards, which is often passed on to customers. The introduction of a similar charge on UPI transactions would mean that customers could bear the additional cost indirectly.
Amazon and other major firms have supported this move, suggesting that a small fee for digital transactions is justified. As digital payments have surged in tandem with the rise in smartphone usage in India, the debate over these charges has intensified.
NPCI’s Recent Announcement
The National Payments Corporation of India (NPCI), which manages the UPI platform, recently announced new interchange rates for UPI transactions linked to credit cards. These rates, akin to MDR, will be implemented starting October 16. The move is seen as a step toward formalizing a fee structure for digital payments.
Impact on UPI Usage
The survey also revealed that 38% of respondents use UPI for around 50% of their total expenses, highlighting the platform’s widespread adoption. With 4 out of 10 people using UPI for transactions, any additional cost could significantly impact consumer behavior and digital payment trends in India.
