Search results for how does UPI payment work explained in India 2026 in India 2026 explained

1. Een.wikipedia.org › wiki › Unified_Payments_InterfaceEN

   Unified Payments Interface - Wikipedia

   # Unified Payments Interface ## History A parallel challenge was combating [black money](https://en.wikipedia.org/wiki/Indian_black_money) and [corruption](https://en.wikipedia.org/wiki/Corruption_in_India), which were primarily facilitated by cash transactions. UPI works on a four-pillar push-pull interoperable model where there will be a remitter/beneficiary front-end PSP ( [payment service provider](https://en.wikipedia.org/wiki/Payment_service_provider)) and a remitter/beneficiary back-end bank that settles the monetary transaction for the users. [[28]](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_note-:7-28) To make UPI economically feasible for payment companies, RBI is considering a [merchant discount rate](https://en.wikipedia.org/wiki/Merchant_discount_rate) (MDR) on future UPI transactions. Currently, around 70% of UPI users are from places other than Tier-1 cities with over 80% of newly registered users originating from Tier-2 cities. [[32]](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_note-32) On 8 August 2024, RBI suggested raising the UPI tax payment ceiling from ₹1 lakh to ₹5 lakh. Over 640 million transactions are handled via UPI per day, compared to 639 million by Visa. ## Internationalization Users will be able to pay in international currency directly from Indian bank accounts. Indian customers will be able to send money abroad using UPI thanks to WhatsApp's upcoming introduction of international payment capabilities. ## Acceptance ### India (Domestic) United Arab Emirates and Singapore, both of which have sizeable Indian expatriate populations, have begun regarding the operation of UPI in those countries; this would also facilitate ease of payment for Indian tourists traveling there. [[170]](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_note-170) NPCI is planning to link UPI with standalone mobile wallets so that users can transfer money from one provider to another one which until now is restricted due to use of closed source technology. There is also provision for off-line UPI payment through the use of [near field communication](https://en.wikipedia.org/wiki/Near-field_communication) (NFC). From 5 September 2019, [Play Store](https://en.wikipedia.org/wiki/Play_Store) enabled UPI for purchasing apps, games and in-app content. [[172]](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_note-172) On 20 April 2020, Google added support for UPI payment in India to buy membership of [YouTube Premium](https://en.wikipedia.org/wiki/YouTube_Premium) and [YouTube Music](https://en.wikipedia.org/wiki/YouTube_Music) either directly through a website or on the mobile application. Now Indian users can also buy or rent movies from [Google TV](https://en.wikipedia.org/wiki/Google_TV_(service)). UPI is also enabled for the YouTube SuperChat feature. From July 2021, [Apple](https://en.wikipedia.org/wiki/Apple_Inc.) [iPhone](https://en.wikipedia.org/wiki/IPhone), [iPad](https://en.wikipedia.org/wiki/IPad), and [IPod Touch](https://en.wikipedia.org/wiki/IPod_Touch) users in India can use UPI on [App Store](https://en.wikipedia.org/wiki/App_Store_(iOS/iPadOS)) and [iTunes Store](https://en.wikipedia.org/wiki/ITunes_Store). [[176]](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_note-176)[[177]](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_note-177) [[179]](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_note-179) As per April 2021 RBI Monetary Policy Committee directive, after 31 March 2022, all the " [know your customer](https://en.wikipedia.org/wiki/Know_your_customer)" (KYC)-compliant [digital wallets](https://en.wikipedia.org/wiki/Digital_wallet) will become interoperable by using UPI system. [[181]](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_note-181) Due to high usage, [Samsung Electronics](https://en.wikipedia.org/wiki/Samsung_Electronics) integrated UPI [barcode scanner](https://en.wikipedia.org/wiki/Barcode_reader) directly into mobile camera application for faster payment. [[186]](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_note-186) [Bangalore Metropolitan Transport Corporation](https://en.wikipedia.org/wiki/Bangalore_Metropolitan_Transport_Corporation) (BMTC) & [Tamil Nadu State Transport Corporation](https://en.wikipedia.org/wiki/Tamil_Nadu_State_Transport_Corporation) (TNSTC) will start UPI based ticketing system from 2023. [[187]](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_note-187) [Lucknow Municipal Corporation](https://en.wikipedia.org/wiki/Lucknow_Municipal_Corporation) (LMC) in collaboration with [Paytm](https://en.wikipedia.org/wiki/Paytm) setting up QR code for housing tax. [Kotak Mahindra Bank](https://en.wikipedia.org/wiki/Kotak_Mahindra_Bank) has rolled out the UPI payment facility for the [Goods and Services Tax](https://en.wikipedia.org/wiki/Goods_and_Services_Tax_(India)) Network (GSTN) in the following states: Assam, Delhi, Goa, Gujarat, Haryana, Himachal Pradesh, Kerala, Madhya Pradesh, Maharashtra, and Odisha. [[189]](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_note-189) On 25 January 2024, [North Western Karnataka Road Transport Corporation](https://en.wikipedia.org/wiki/North_Western_Karnataka_Road_Transport_Corporation) (NWKRTC) achieved a significant milestone by processing over one lakh UPI transactions, valued at over ₹2 crore. Other bus depots in Chennai will also be included in the pilot experiment in future. For all MTC buses, the Tamil Nadu Infrastructure Development Board (TNIDB) intends to implement a QR-based ticketing system for UPI payment. [[191]](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_note-191) NPCI has integrated [Kendriya Vidyalaya Sangathan](https://en.wikipedia.org/wiki/Kendriya_Vidyalaya_Sangathan) with the [Bharat Bill Payment System](https://en.wikipedia.org/wiki/Bharat_Bill_Payment_System), allowing pupils to pay their school fees with UPI. UPI-based ticketing system made accessible from June 2024 at [Kolkata Metro Blue Line](https://en.wikipedia.org/wiki/Kolkata_Metro_Blue_Line). Automatic Smart Card Recharge Machine has already incorporated it. Additionally, [Kolkata Metro Green Line](https://en.wikipedia.org/wiki/Kolkata_Metro_Green_Line) stations also have UPI facility.[[193]](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_note-193) [Kolkata Metro Orange Line](https://en.wikipedia.org/wiki/Kolkata_Metro_Orange_Line) were made UPI enabled from July 2024. With the goal of reducing reliance on third-party apps, minimizing unsuccessful payments, and streamlining the checkout process, [Zomato](https://en.wikipedia.org/wiki/Zomato) and [Swiggy](https://en.wikipedia.org/wiki/Swiggy) launched their own UPI services. Zomato partnered with ICICI Bank, whereas Swiggy is utilizing the UPI Plugin to enable payment, doing away with the need for a TPAP license. UPI payment methods for temple offerings have also been implemented by the [Travancore Devaswom Board](https://en.wikipedia.org/wiki/Travancore_Devaswom_Board). Under schemes like Rebate of State and Central Taxes and Levies (RoSCTL) and Remission of Duties and Taxes on Exported Products (RoDTEP), Indian government will permit the payment of customs duties via UPI and expand its use beyond duty payments to include expedited processing of refunds and incentives. ## References 9. [↑](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_ref-9)[[https://eacpm.gov.in/wp-content/uploads/2026/03/Financial-Inclusion-as-a-Path-to-Equality-Lessons-from-India.pdf](https://eacpm.gov.in/wp-content/uploads/2026/03/Financial-Inclusion-as-a-Path-to-Equality-Lessons-from-India.pdf)](https://eacpm.gov.in/wp-content/uploads/2026/03/Financial-Inclusion-as-a-Path-to-Equality-Lessons-from-India.pdf) UPI transactions hits record high 18. [↑](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_ref-18)["10 years of UPI: 66 crore transactions a day and other figures that stand out - CNBC TV18"](https://www.cnbctv18.com/photos/india/upi-ten-years-india-digital-payments-transaction-growth-npci-real-time-payments-19976236.htm). _CNBCTV18_. 25 August 2026. Retrieved 25 August 2026. 20. [↑](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_ref-20)["UPI Product Overview"](https://www.npci.org.in/what-we-do/upi/product-overview). National Payments Corporation of India. Retrieved 16 March 2026. 82. [↑](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_ref-82)["Government may allow fees on UPI payment above Rs 2,000"](https://timesofindia.indiatimes.com/india/government-may-allow-fees-on-upi-payment-above-rs-2k/articleshow/132880274.cms). _The Times of India_. 5 August 2026. [ISSN](https://en.wikipedia.org/wiki/ISSN_(identifier)) [0971-8257](https://search.worldcat.org/issn/0971-8257). Retrieved 24 August 2026. 85. [↑](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_ref-85)["UPI remains free for consumers, payments over Rs 2,000 to merchants will attract 0.4% fee"](https://www.indiatoday.in/business/story/upi-remains-free-for-consumers-payments-over-rs-2000-to-merchants-will-attract-04-fee-2995255-2026-09-15). _India Today_. 15 September 2026. Retrieved 16 September 2026. 86. [↑](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_ref-86)["0.4% MDR kicks in from October 15 for ₹2,000-plus UPI payments"](https://www.business-standard.com/finance/news/npci-sets-0-4-fee-on-upi-merchant-payments-above-2-000-effective-oct-15-126091501061_1.html). _Business Standard_. 16 September 2026. Retrieved 16 September 2026. 228. [↑](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_ref-228)["India launches UPI at department store in France"](https://www.thehindubusinessline.com/money-and-banking/india-launches-upi-at-department-store-in-france/article71111839.ece). _BusinessLine_. 17 June 2026. Retrieved 18 June 2026. 240. [↑](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_ref-240)["India-Israel sign pact to link UPI systems in major digital payments push"](https://www.moneycontrol.com/world/india-israel-sign-pact-to-link-upi-systems-in-major-digital-payments-push-know-where-else-the-platform-works-article-13844648.html). _Moneycontrol_. 26 February 2026. Retrieved 26 February 2026. 242. [↑](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_ref-242)["Indian travellers can now use UPI at QR-code merchants in Cambodia"](https://www.thehindubusinessline.com/money-and-banking/upi-acceptance-at-qr-code-merchants-goes-live-in-cambodia/article71058268.ece). _BusinessLine_. 4 June 2026. Retrieved 18 June 2026. 244. [↑](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_ref-244)Singh, Rohit (6 June 2026). ["UPI Payments Launch in Cambodia for Indian Travellers"](https://www.medianama.com/2026/06/223-india-launches-upi-qr-payments-cambodia/). _medianama.com_. Retrieved 18 June 2026. 252. [↑](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_ref-252)Shinde, Shivani (8 September 2026). ["Bank of America works on Zelle-UPI bridge for cross-border payments"](https://www.business-standard.com/companies/people/bank-of-america-works-on-zelle-upi-bridge-for-cross-border-payments-126090701041_1.html). _[Business Standard](https://en.wikipedia.org/wiki/Business_Standard)_. Retrieved 12 September 2026. 253. [↑](https://en.wikipedia.org/wiki/Unified_Payments_Interface#cite_ref-253)["Zelle to expand peer-to-peer payment service to India this year"](https://economictimes.indiatimes.com/tech/technology/zelle-to-expand-peer-to-peer-payment-service-to-india-this-year/articleshow/131661250.cms?from=mdr). _The Economic Times_. 11 June 2026. [ISSN](https://en.wikipedia.org/wiki/ISSN_(identifier)) [0013-0389](https://search.worldcat.org/issn/0013-0389). Retrieved 12 September 2026.
2. Bbbc.com › news › articles › c8xnwqe00v1oEN

   India built a digital payments miracle. Now comes the bill. - BBC

   Site search News Business Technology Audio Video Live Documentaries # India built the world's biggest digital payments miracle. Now comes the bill Scan a QR code, tap a few buttons and the money moves instantly. There is no card machine, no cash, and - most importantly - for the user, no visible fee. India has [paved the way](https://thewire.in/banking/lok-sabha-passes-bill-allowing-govt-to-permit-banks-others-to-charge-for-upi-transactions) for banks and payment companies to charge merchants a fee on UPI transactions, potentially ending a decade-long experiment in free digital payments. The government [says](https://www.pib.gov.in/PressReleasePage.aspx?PRID=2296594&reg=48&lang=2) consumers and person-to-person UPI payments will remain free. If merchant fees are introduced, they will apply only to some transactions above a set threshold, at a nominal rate, meaning most UPI payments will remain free. A man stands beside a horse fitted with a payments QR code near its eye, allowing riders to pay digitally after a beach ride Fintech apps such as PhonePe and Google Pay account for most UPI payments. In the financial year just ended, the figure was about 241.6 billion transactions - almost 12,000 times the volume in UPI's first full year. UPI is not merely big. The system is run by the National Payments Corporation of India, a non-profit entity, with banks and technology companies providing the consumer-facing services. A vegetable seller, taxi driver or small shopkeeper does not need to buy a card terminal to accept UPI. A printed QR code will do. One option reportedly under discussion would target transactions above 2,000 rupees at larger merchants, leaving small businesses and low-value payments untouched. Transactions above that threshold account for only about 4% of merchant-payment volumes but roughly 67% of their value, according to brokerage firm Jefferies. That could generate a sizeable new revenue stream - up to a billion dollars, by one [estimate](https://x.com/refsrc/status/2084486790405345404?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E2084486790405345404%7Ctwgr%5E76a20d07d91e080db36c073d97839e992897e0cf%7Ctwcon%5Es1_&ref_url=https%3A%2F%2Fwww.medianama.com%2F2026%2F08%2F223-rbi-governor-upi-mdr-premature%2F) - for banks and payment companies while leaving the everyday smaller payment to the neighbourhood grocer effectively unchanged. UPI may feel free, but it is not costless. Servers have to run, transactions settled, fraud detected and the system protected against cyberattacks. "Even a small fee could matter if it changes the incentives of small merchants operating on thin margins," he says. A fee imposed on a large retailer is very different from one imposed on a tiny shop or informal trader. The first phase was about creating the network.
3. Bblog.orbitremit.com › what-is-upi-india-guideEN

   What Is UPI? India's Real-Time Payment System Explained

   UPI connects hundreds of Indian banks through a single interface. India accounts for roughly half of all real-time payment transactions on the ...
4. Rredcompasslabs.com › insights › what-is-upi-indias-instant-payment-scheme-explainedEN

   What is UPI? India's instant payment scheme explained

   ## What is UPI? India’s instant payment scheme explained What is UPI? India’s instant payment scheme explained | 100 Seconds Series - YouTube Tap to unmute [What is UPI? India’s instant payment scheme explained | 100 Seconds Series](https://www.youtube.com/watch?v=RJuTJ3pscCc) [RedCompass Labs](https://www.youtube.com/channel/UCNb8I9tl7qQG5g6mRRGhzcA)  RedCompass Labs2.15K subscribers [Watch on](https://www.youtube.com/watch?v=RJuTJ3pscCc) UPI has revolutionized the way India transacts. So much so that fast, simple, and cost-effective payments have become a way of life for Indian consumers. How does it work? And what can banks across Europe and North America learn? ## What is UPI? UPI stands for Unified Payments Interface. It is an [instant payments system](https://www.redcompasslabs.com/instant-payments/) developed by the [National Payment Council of India](https://www.npci.org.in/), which facilitates [Person to Person (P2P)](https://www.redcompasslabs.com/insights/instant-payments-series-person-to-person-solutions/) and [Person to business (P2M)](https://www.redcompasslabs.com/insights/instant-payments-series-person-to-business-solutions/) transactions. Anyone with a smartphone, an active bank account, and internet access can send money for free, in the blink of an eye. In fact, you can transact faster than the time you spend logging into your banking application. UPI launched in October 2016 and clocked one million transactions that month. Seven years later, the scheme had just crossed an eye-watering 11 billion transactions worth 261 billion US dollars. ## So how does it work? UPI is a QR code-based payment. It doesn’t matter who provides the QR code or UPI service, users can send and receive money using any UPI app. Its ability to function across multiple payment schemes makes it a powerful enabler for a global interoperable payments system. This brings us to the biggest selling point for UPI internationally: UPI could both accelerate growth and reduce the cost of cross-border transactions to and from India. That’s huge. According to the World Bank, India’s remittances exceeded [US$111 billion in 2022](https://documents1.worldbank.org/curated/en/099061923180531190/pdf/P179250-27805f20-f8df-4018-8ee0-c9f753637b8a.pdf?), the most of any nation in the world and significantly ahead of major economies such as China. UPI is: 1. **Free** – Payment authentication and authorization is done by the Unique Identification Authority of India free of charge. 2. **Secure** – Tokenization makes the payment data unreadable and hence removes the need to store and maintain the data by the Bank. 3. **Available** – As per the data published by NPCI for the last few quarters, there was zero downtime recorded for the availability of UPI for payment transactions But why is this of interest to any country other than India? And why is a global technology giant like Apple working to integrate with UPI and create a localized version of Apple Pay? Stay tuned for part two of our 100-second mini-series on UPI, where we will discuss the use cases of UPI around the world. [Subscribe to our YouTube channel](https://www.youtube.com/channel/UCNb8I9tl7qQG5g6mRRGhzcA) to get notified when the next episodes are published. Share this post [](https://www.linkedin.com/sharing/share-offsite/?url=https://www.redcompasslabs.com/insights/what-is-upi-indias-instant-payment-scheme-explained/)[](https://twitter.com/share?url=https://www.redcompasslabs.com/insights/what-is-upi-indias-instant-payment-scheme-explained/)[](https://www.facebook.com/sharer/sharer.php?u=https://www.redcompasslabs.com/insights/what-is-upi-indias-instant-payment-scheme-explained/) [Instant Payments](https://www.redcompasslabs.com/insights?tag=instant-payments) [Interoperability](https://www.redcompasslabs.com/insights?tag=interoperability) #### Written by  Pratiksha Pathak Head of Payments Services, RedCompass Labs You may also like
5. Ggrow.cleverbridge.com › blog › upi-india-saas-digital-goodsEN

   UPI in India: How It Works for SaaS and Digital Goods

   - [Expanding in India? UPI is the Payment Method You Can’t Ignore](https://grow.cleverbridge.com/blog/upi-india-saas-digital-goods) For many digital transactions, that means UPI: India’s real-time, bank-linked payment system, now central to everyday digital commerce. For global digital businesses expanding into India, enabling UPI is about aligning checkout with regional payment behavior. UPI is already deeply embedded in how many consumers handle digital transactions, which makes local payment support an important part of reducing friction and improving checkout performance. ## **What is UPI?** Unified Payments Interface (UPI) is India’s real-time payment system for bank-to-bank transactions. It allows customers to pay directly from a bank-linked app, without entering card details at the point of sale. At checkout, the customer selects UPI and approves the payment in their UPI app, often by scanning a QR code. For recurring payments, UPI AutoPay lets the customer authorize an e-mandate so future charges can be processed within approved limits. Behind the scenes, UPI is supported through a local payment service provider (PSP), allowing transactions to be routed domestically and handled in line with Indian regulatory requirements. That helps keep the payment flow fast and locally aligned, rather than forcing a less natural cross-border path. ## **Why Cleverbridge is introducing UPI** In India, checkout expectations are already well established. ## **The scale of UPI in India** UPI’s impact is best understood through its scale. The system processes over 20 billion transactions per month, with monthly transaction values exceeding ₹28 trillion (approximately $307 billion), according to the latest data from the [National Payments Corporation of India (NPCI)](https://www.npci.org.in/what-we-do/upi/product-statistics). In fact, [UPI accounts for nearly half](https://economictimes.indiatimes.com/tech/technology/upi-recognised-as-worlds-largest-real-time-payment-system-by-imf-accounts-for-49-of-global-transactions/articleshow/125838772.cms?from=mdr) of all global real-time payment transactions. These figures add up to show how central UPI has become to digital transacting in India. Thanks to UPI, payments are expected to be real-time, direct, and frictionless — from merchants to peer transfers to the subscription economy. ## **Where UPI fits in India's payment mix** India’s payment mix is increasingly shaped by mobile, bank-linked behavior. From our Indian buyer data in [_The Friction Report_](https://grow.cleverbridge.com/friction-report), 42% said digital wallets are their preferred way to purchase software, compared to 18% for cards and 8% for bank transfers. This preference points in UPI’s direction, as everyday payments are increasingly mobile, app-led, and real-time. As far as how UPI stacks up against Net Banking, both serve unique purposes. They are less competing options than complementary ones, with UPI capturing more day-to-day consumer payments, while Net Banking supports more high-value transactions. | | | | | |-|-|-|-| | Payment Method | Best Fit | Checkout Experience | Recurring Payments | | UPI | Everyday digital commerce, mobile-first checkout, B2C SaaS | Real-time approval in UPI app (via QR code) | Supports AutoPay for eligible recurring transactions | | Net Banking | Higher-value purchases, enterprise billing, B2B SaaS | Redirects customers through online banking to complete payment | Commonly used to authenticate eNACH mandates for recurring billing | ## **Bottom line** UPI is central to how digital commerce operates in India. Businesses that support it can reach more customers, reduce checkout friction, and improve payment performance. If India is part of your growth strategy, supporting UPI should be part of your payment strategy. [Click here](https://docs.cleverbridge.com/docs/cleveressentials/payments-taxes/payment-options/other-payment-options/upi/).
6. Ffacebook.com › sumitsimplify › videos › upi-new-rules-2026-explained-what-changes-for-every-userupi-new-rules-2026-upi-uEN

   UPI New Rules 2026 Explained: Merchant Fee, Limits & Tap to ...

   UPI new rules 2026, UPI update 2026, UPI latest news, UPI payment rules, NPCI update, digital payments India, UPI limit 2026, UPI merchant fee, ...
7. Iinsightsonindia.com › 2026 › 09 › 01EN

   The Unified Payments Interface (UPI) - INSIGHTS IAS

   UPI is an advanced, real-time interoperable payment system that enables instantaneous inter-bank fund transfers directly through mobile ...
8. Llinkedin.com › posts › yashsheth_upi-2026-rules-explained-what-founders-activity-7421748766770167808-8SFCEN

   Higher Limits, Stronger Security, and GST Linkage 3. UPI ...

   UPI is no longer just a consumer payment tool. now allow payments up to ₹5 lakh. This moves UPI from “chai payments” to: • college fees • ...
9. Rreuters.com › world › india › indias-upi-fee-shake-up-what-changes-why-it-matters-2026-09-16EN

   India's UPI fee shake-up: What changes and why it matters

   [Skip to main content](https://www.reuters.com/world/india/indias-upi-fee-shake-up-what-changes-why-it-matters-2026-09-16/#main-content) But ​after six years of free use, regardless of size or type of payment, India has decided [to ‌start charging](https://www.reuters.com/world/india/india-payments-authority-sets-04-fee-upi-merchant-payments-above-2000-rupees-2026-09-15/) merchants a fee of 0.4% for transactions of more than 2,000 rupees ($21), known as the Merchant Discount Rate (MDR), with some exclusions, though person-to-person transfers remain free. ## HOW BIG ​IS UPI? In August, UPI processed a total of 24.5 billion transactions worth 29,823 billion rupees ⁠for more than 550 million users, official data show. UPI has a share of 84% in India's digital payments ​by volume and a 49% share of global real-time payment volumes, the government said on Tuesday. Walmart's PhonePe and Alphabet's ​GooglePay had about 80% market share by value of UPI transactions in August. ## WAS UPI ALWAYS FREE? Its pricing model at launch in 2016 included nominal charges temporarily waived in 2017 when India demonetised a large chunk of its high-denomination currency notes. ## WHAT FEE WILL BE IMPOSED? A fee ​of 40 basis points applies to transactions above 2,000 rupees with merchants, along with carve-outs for payments to small merchants and those operating ‌in ⁠rural or semi-urban areas. Widely used categories such as telecom, railways and mutual fund or stock investments will attract lower charges. Fees are capped at 300 rupees on transactions exceeding 75,000 rupees. ## WHY DOES UPI NEED THE MERCHANT DISCOUNT RATE? India's ​government, the central bank and payments authority say, the MDR will help make UPI self-sustainable, give a fillip to expansion in rural and semi-urban ​areas, and keep a large majority of payments free of charge. ($1=95.9275 rupees) Advertisement · Scroll to continue Our Standards: [The Thomson Reuters Trust Principles., opens new tab](https://www.thomsonreuters.com/en/about-us/trust-principles.html) - X - Facebook - Linkedin - Email - Link [Purchase Licensing Rights](https://www.reutersagency.com/en/licensereuterscontent/?utm_medium=rcom-article-media&utm_campaign=rcom-rcp-lead)
10. Ffacebook.com › Persistclasses › posts › upi-has-become-a-part-of-our-everyday-lifefrom-paying-at-local-shops-to-sending-EN

    India's new UPI rules 2026 and transaction limits - Facebook

    From transaction limits and stricter KYC checks to increased monitoring of high-value UPI activity, the system is getting tighter. What this ...