Ashneer Grover has questioned the need for any levy on UPI transactions, arguing that the digital payments system has already created huge benefits for banks, the government and the wider economy.
Reacting to the growing debate over UPI charges, the former BharatPe co-founder took to X and said people only need to look at the numbers to understand where the money is going.
“India mein koi 5 minutes number Google kar le to doodh ka doodh paani ka paani ho jaye,” (Just spend five minutes Googling the numbers and the truth becomes crystal clear), Grover wrote.
He then listed the Reserve Bank of India’s surplus transfer to the government at Rs 2.87 lakh crore, total profits of listed banks at Rs 4.11 lakh crore and NPCI’s pre-tax surplus at Rs 1,888 crore.
“So who is actually losing money because of UPI, and what subsidy is the government giving to UPI that is supposedly hurting?” Grover asked.
He also compared the cost of maintaining India’s cash-based payment infrastructure with the financial position of the UPI ecosystem.
“Cost of running ATMs and cash logistics in India is Rs 30,500 crores (US$ 3.0 Bn). If you want to optimise shut ATMs and promote UPI instead,” he wrote.
According to Grover, imposing a levy on UPI would not be about recovering a subsidy but would effectively amount to another form of tax collection.
“Any levy on UPI is just tax collection,” he said.
Grover also highlighted UPI’s wider importance for India’s digital payments’ ecosystem, calling it a major achievement that has gained recognition globally.
The government notification issued on September 14 states that banks and system providers cannot impose any direct or indirect charge on payments made or received through UPI transactions up to Rs 2,000.
The provision also applies to transactions made through RuPay-powered debit cards.
However, there is no new charge on UPI payments above Rs 2,000 under the notification.
The key point is that the notification creates a threshold below which charges cannot be imposed. This has raised questions about whether merchant discount rates, or MDR, could eventually be introduced for certain higher-value merchant transactions.
For now, the answer is no.
Consumers can continue to scan a QR code and make UPI payments without paying a transaction fee. Person-to-person UPI transfers also remain free.
The government has repeatedly maintained that consumers should not be charged for using UPI. Its August clarification indicated that any future MDR would apply only to certain merchant transactions above a specified threshold, while the overwhelming majority of UPI transactions would remain free.
This means that for everyday users, there is no immediate change when making UPI payments.
The bigger concern is whether merchants could eventually face charges on some transactions and whether those costs could be passed on to customers.
Meanwhile, The National Payments Corporation of India (NPCI), which operates UPI, is expected to issue the operational directive on MDR.
Until then, there is no new UPI fee for consumers under the latest notification.
For now, the debate is less about whether users will suddenly start paying for UPI and more about whether a future charging structure could emerge for certain merchant transactions above the threshold.
A detailed operational directive on the proposed merchant discount rate (MDR) is expected from the National Payments Corporation of India (NPCI), according to a report by The Economic Times.
Until those details are announced, it remains unclear how any potential merchant charge would work and who would ultimately bear the cost.
For now, there is no new UPI charge for consumers. But the government’s latest notification has certainly opened a fresh debate over who should pay for India’s rapidly expanding digital payments network — and whether UPI itself needs to be treated as a cost rather than as a major saving for the economy.