New Delhi, September 27 (IANS). The UPI payment system operated by the National Payments Corporation of India (NPCI) is the world's largest retail fast-payment system by transaction volume.
According to the report of South China Morning Post, UPI has accelerated the digital revolution in India. It has helped connect large sections of the population to the formal economy and has become the backbone of the digital economy, where electronic payments are becoming an increasingly important part of everyday business.
According to government data, the number of annual UPI transactions will increase to 241.62 billion in fiscal year 2025-26, from 17.8 million in 2016-17. The value of transactions increased from Rs 7,000 crore to Rs 3.14 lakh crore during the same period.
Now, a decade after the launch of the Unified Payments Interface (UPI), the government is considering charging big merchants for its use, so that the system remains sustainable in the long run and the cost of running it can be recovered.
The report said a fixed and predictable source of income would encourage banks and payments companies to invest more in cyber security, fraud detection and dispute resolution. Additionally, it will also help in developing the next phase of UPI, which will likely include providing lines of credit and expanding cross-border payments.
“Many payment systems in Asia and the Global South have studied UPI because it proved that systems can be scaled up on a large scale without giving control of payment switches to Visa, MasterCard or any foreign boardroom,” the report quoted an expert as saying.
Rohit Arora, co-founder and CEO of Biz2Credit, a fintech company in the port, was also quoted as saying that after so many years of free usage, charging some costs from merchants was inevitable.
The UPI network now operates in 11 countries including Singapore, UAE, France, Mauritius, Nepal, Bhutan, Qatar, Sri Lanka, Cambodia, Greece and Uzbekistan. Indian tourists, business travelers and students can make person-to-merchant (P2M) payments directly from their Indian bank accounts. This eliminates the hassle of markup on foreign exchange and reduces dependence on international cards or cash. This initiative advances cooperation in the field of digital public infrastructure.
The report also said that other countries such as Indonesia have different rates of fees for their payment systems, depending on the category of the merchant and the size of the transaction. Similarly, the fees charged to DuitNow merchants in Malaysia depend on the bank or payment service provider and fee waivers are also available in some cases.
According to the report, the basic problem faced by other countries was the same as India, as it costs money to build and operate a secure payments network.
–IANS
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