Digital Payments: Merchant Fees on UPI, RuPay Under Discussion
Let us know whether digital payment is not going to be free? The government is preparing to impose merchant charges on UPI and RuPay transactions. This can have many effects on the users.
The Government of India plans to impose merchant charges on Unified Payments Interface (UPI) and RuPay transactions.
Let us tell you, this step has been taken to regulate digital payments and create a sustainable revenue model for the ecosystem.
Merchant fee and Impact on users
Merchant fee is the fee that merchants pay to the payment service provider for each digital payment transaction. Which is usually only one percent of the transaction amount.
Let us inform you that there is little chance of any direct impact on users due to the implementation of merchant fees.
But due to this, merchants may be less inclined to accept digital payments.
If this happens, it may become more difficult for users to pay for goods and services through digital payments.
Government’s justification and industry response
The government says that merchant fees will help create a sustainable revenue model for the payment ecosystem.
Not only this, it will encourage payment service providers to continue investing in their infrastructure as well as provide better services to their customers.
The industry has reacted mixedly to the government’s decision to impose merchant fees. Some merchants say the plan will increase their costs, while others say it will make them less inclined to accept digital payments.
On the other hand, according to some merchants, this will help create a sustainable revenue model for the payments ecosystem.
Disclaimer: This article provides information based on current reports and discussions. Policy changes are subject to government decisions and may change.
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