New Delhi, August 7: The Lok Sabha has passed a Bill amending the Payment and Settlement Systems Act, 2007, creating a legal framework that could allow the government to permit banks and other payment service providers to levy charges on transactions made through the Unified Payments Interface (UPI) and other notified electronic payment modes.
The amendment, passed by the Lower House on August 6, modifies the existing provision that restricts banks and payment system providers from imposing charges on persons making or receiving payments through prescribed electronic modes.
However, the passage of the Bill does not mean that charges on UPI transactions have been introduced immediately. Any such levy would depend on subsequent decisions and notifications by the Central Government.
At present, UPI transactions continue under the existing zero-charge framework for users, and no new transaction fee has automatically come into effect following the Lok Sabha’s approval of the amendment.
The development is significant given the massive growth of UPI as one of India’s primary digital payment systems. The amendment provides the government with greater flexibility to determine the charging framework for UPI and other electronic payment systems in the future.
The Bill will have to complete the remaining legislative process before becoming law.
