The National Payments Corporation of India (NPCI) has directed the payment apps to stop charging platform fees for the Bharat Bill Payment System (BBPS) payments. NPCI’s directive comes days after a discussion paper was released by the Reserve Bank of India (RBI) related to such charges.
A report by the Times of India stated that PhonePe, one of the largest UPI payment platforms in India, had started charging fees on some recharges and other payments. In July, Paytm also started charging Rs 1 for various bill payments.
After NPCI’s directive, Paytm announced that it is no longer charging the fees from the customers. PhonePe has also announced that it is discontinuing charging the fees on the BBPS platform, the report added.
Both companies stated that it was started as an experiment. PhonePe had stated that the experiment’s results were ‘promising’ and that 98 per cent of the consumers were willing to pay the fees.
The transaction volume through BBPS has grown substantially in the last four months. In April, transactions worth Rs 11,324 crore took place through the platform. This jumped to Rs 16,218 crore in July. In May and June, the figure stood at Rs 13,824 crore and Rs 15,154 crore, respectively.
On the other hand, the transaction volume has jumped from 74 million in April to 86 million in July, TOI further reported.
After the RBI’s discussion paper, the Ministry of Finance tweeted, “UPI is a digital public good with immense convenience for the public and productivity gains for the economy. There is no consideration in Govt to levy any charges for UPI services. The concerns of the service providers for cost recovery have to be met through other means.”
In July, the number of UPI transactions crossed the 6 billion mark. Under UPI, BBPS allows online payment of various bills, including electricity and water.