UPI transactions new rule from April 1: Users will not be charged due to PPI interchange, clarifies NPCI

Any Unified Payments Interface (UPI) transaction of more than Rs 2,000 via prepaid payment instruments (PPI) like online wallets or pre-loaded gift cards, etc., will carry an interchange fee of up to 1.1 percent from April 1, 2023. The interchange fee is typically associated with card payments and is levied to cover the costs of accepting, processing, and authorising transactions.

While digital platforms such as Cashfree Payments, Spice Money have hailed the move, consumers might have several queries regarding this. Here's an FAQ answering all those queries:

No. The interchange charges introduced 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), NPCI made it clear in a circular.