0.4% charge on 2000 plus UPI transactions

[randomGuy]

Expected to generate annual 21000 cr. To be shared between banks and UPI apps (phonepe, paytm, gpay)

 

UPI apps expected to get 7000 cr. 

 

Jackpot for UPI apps. Why is govt giving them this much?

 

Edit, not that bad. Phonepe is loss making while paytm and gpay are barely break even

Edited yesterday at 03:11 PM by randomGuy

[ravishingravi]

1 hour ago, randomGuy said:

Expected to generate annual 21000 cr. To be shared between banks and UPI apps (phonepe, paytm, gpay)

 

UPI apps expected to get 7000 cr. 

 

Jackpot for UPI apps. Why is govt giving them this much?

 

Edit, not that bad. Phonepe is loss making while paytm and gpay are barely break even

 

Revenue for them. Tax for govt. 

[IndianRenegade]

infra is not free, a small fee should be fine.

[Trichromatic]

3 hours ago, IndianRenegade said:

infra is not free, a small fee should be fine.

 

This infra helps reducing lot of other costs as well - cash and ATMs usage, so maintaining this infra this is not entirely loss.

 

Cash usage is free of charge, but maintaing cash circulation is costly.

[Trichromatic]

If this results in increase in cash usage then how much does govt lose from that?

[zen]

So people are just going to accept - currency change, E20 Petrol, inflation, corruption, almost a new law everyday to milk money from public as it GOI is a corporate (0.4%), ...   

[Lord]

Small vendors will be effected.  Cash will be back

 

Why change something working so well that its one of the few things we lead in?

[randomGuy]

2 hours ago, zen said:

So people are just going to accept - currency change, E20 Petrol, inflation, corruption, almost a new law everyday to milk money from public as it GOI is a corporate (0.4%), ...   

It is not 0.4% on everything. 

 

"Person-to-Person (P2P) — Still FREE

 

Merchant payments up to ₹2,000 — FREE

 

Merchant payments above ₹2,000 — 0.4% MDR

 

Maximum MDR for general merchants — ₹300 per transaction

 

Railways, telecom, insurance, fuel and certain other categories — ₹5 flat MDR"

 

 

 

[randomGuy]

2 hours ago, Lord said:

Small vendors will be effected.  Cash will be back

 

Why change something working so well that its one of the few things we lead in?

Right now I order things via credit card and then, pay the credit card monthly bill via UPI, mostly above 2000. That also remains free.

 

"If you are clearing your credit card dues using a UPI app (like your bank's app, or PhonePe), you will not be charged a 0.4% fee."

[Trichromatic]

3 hours ago, Lord said:

Small vendors will be effected.  Cash will be back

 

Why change something working so well that its one of the few things we lead in?

Because people like to believe cash comes with 0 infra cost, only digital infra comes with cost.

[Tillu]

Ultimately all these extra charges will be passed on to the consumers.

[New guy]

46 minutes ago, Tillu said:

Ultimately all these extra charges will be passed on to the consumers.

Yep, merchants will be forced to increase prices. We will pay

[Trichromatic]

4 minutes ago, New guy said:

Yep, merchants will be forced to increase prices. We will pay

 

Officially they will increase price.

 

Unofficially they will if you pay by cash then this is price, else pay x% extra.

[Trichromatic]

How is this loophole covered? Customers can pay 2000 4 times instead of paying 8k?

[coffee_rules]

7 hours ago, Lord said:

Small vendors will be effected.  Cash will be back

 

Why change something working so well that its one of the few things we lead in?

96% of transactions on UPI is below ₹2000. Any amount of P2P transactions is not charged. There is a 0.4% charge on transactions about 2000. So typically for a ₹10,000 transaction, a 40  rupee fee is charged. This week is charged to the merchant and/ or the bank. Even if it discharged to the Customer, 0.4% is not too much for the customer to bear.
 

The overheads of UPI platform was subsidized by the government. That means it was the income tax/corporate tax/GST paid by citizens was paying for the infra. Now the extra burden needs to be  Borne by the merchant/bank/rich customers only. Nothing is free in this world.

 

Customers  pay very high interest  for credit cards and the banks for  maintaining minimum balance. This is very negligible compared to petrol fee hike. Rotlu crowd will cry in any case.

Edited 9 hours ago by coffee_rules

[coffee_rules]

3 hours ago, Trichromatic said:

How is this loophole covered? Customers can pay 2000 4 times instead of paying 8k?

By limiting the max transactions per day

[New guy]

7 hours ago, Trichromatic said:

 

Officially they will increase price.

 

Unofficially they will if you pay by cash then this is price, else pay x% extra.

Exactly, it's either higher price or lots of inconvenience 

[randomGuy]

12 hours ago, zen said:

So people are just going to accept - currency change, E20 Petrol, inflation, corruption, almost a new law everyday to milk money from public as it GOI is a corporate (0.4%), ...   

Rupees 20000cr charge for 100 cr people is 200 rupees per person per year.

[zen]

30 minutes ago, randomGuy said:

Rupees 20000cr charge for 100 cr people is 200 rupees per person per year.

It does not work that way. 

[Trichromatic]

6 hours ago, coffee_rules said:

By limiting the max transactions per day

Current limit is 1 lakhs per day from 1 account. Number of transactions is not limited as you can pay at 10 places in vegetables and 5 shops during a festival day. Much higher during events.