Home / Business and Economy / UPI Fees: 75% Users May Ditch Digital Payments
UPI Fees: 75% Users May Ditch Digital Payments
11 Apr
Summary
- Nearly 75% of Indian UPI users would stop using the platform if fees are introduced.
- A survey indicates a significant increase in user resistance to transaction charges.
- Merchant refusal of UPI payments for cash is increasingly common, users report.
A significant portion of Unified Payments Interface (UPI) users in India, estimated at 75%, are likely to cease using the platform if transaction fees are introduced. This finding emerged from a recent survey, underscoring the value users place on free digital payments as UPI approaches a daily transaction volume of one billion.
The survey, titled UPI@10, suggests that even nominal charges could trigger substantial shifts in consumer behavior. Resistance to transaction fees has intensified since 2025, indicating a growing concern among users. Furthermore, the report noted an increase in merchants refusing UPI payments, with a considerable number of users reporting such instances over the past year.
The debate over potential charges has been reignited by a parliamentary committee's suggestion to reinstate the Merchant Discount Rate (MDR) on UPI. While MDR is a fee merchants pay for transaction processing, its removal in 2020 aimed to promote affordable digital payments. Users now fear that any reintroduction of such charges could eventually be passed on to them, jeopardizing the continued expansion and adoption of India's digital payment system.
