In a circular published by the National Payments Corporation of India (NPCI), the organisation proposed “Prepaid Payment Instruments (PPI)” fees for merchant transactions using the Unified Payments Interface (UPI). The UPI payment system’s regulatory body also stated that PPI costs will be charged on transactions exceeding 2,000 made using UPI. There will be an interchange at the rate of 1.1% of the transaction’s value. The interchange charge is assessed to defray the expenses associated with transaction authorization, processing, and acceptance. This will probably increase the price of the transaction. The new regulation will go into effect on April 1.
The circular stated that for loading a transaction value exceeding $2,000, the issuer of prepaid instruments would additionally be required to pay 15 basis points of the cost to the remitter bank.
Significantly, the fee will not be charged for transactions between a bank and the prepaid wallet that are made between individuals or between individuals and merchants. Before the 30th of September, NPCI is expected to reevaluate the stated pricing.
