UPI Remains Free: Government Debunks Rumours of Transaction Charges
MyGovIndia has officially clarified that Unified Payments Interface (UPI) transactions remain free for all users. Viral social media claims suggesting that personal peer-to-peer transfers and routine merchant payments will soon be charged are misleading. Recent amendments to the PSS Act are enabling provisions for security, not new consumer fees.
Digital payment users across India can continue to use the Unified Payments Interface (UPI) without additional costs, according to a recent clarification from the government. MyGovIndia has officially debunked viral social media claims suggesting that daily person-to-person (P2P) transfers and routine merchant payments would soon become chargeable.
The confusion stemmed from recent discussions regarding an amendment to the Payment and Settlement Systems Act (PSS Act). While these legislative updates aim to strengthen the nation's digital payment infrastructure, officials have stressed that they do not introduce fees for everyday consumers. Will UPI Still Be Free? What FM Nirmala Sitharaman Said After Parliament Cleared Taxation Bill (Video).
No Fees for P2P and Merchant UPI Payments, Government Issues Clarification
Myth: Sending money to friends or family through UPI will become chargeable.
Standard bank-to-bank UPI transfers remain completely free for everyday personal use, with zero transaction charges added to your payments.#MyGovMythbusters#UPI#DigitalPayments pic.twitter.com/oFU9AS3SqK
— MyGovIndia (@mygovindia) August 9, 2026
Myth: Every merchant accepting UPI will have to pay charges.
Most everyday payments to businesses stay completely free. Any future fee will only affect certain high-value business payments. The rate will be small, and it will still cost much less than using a debit or credit… pic.twitter.com/usQLSn3iWK
— MyGovIndia (@mygovindia) August 9, 2026
Fact-Checking Common Myths
MyGovIndia addressed several prevalent myths to provide clarity on the current state of UPI transactions:
- Peer-to-Peer (P2P) Transfers: All personal bank-to-bank UPI transfers remain free. Whether splitting a restaurant bill, paying rent, or sending money to family members, users will continue to face zero transaction charges.
- Routine Merchant Payments: Payments made for groceries, taxi rides, or other daily necessities at merchant outlets remain free for consumers. Any future regulatory framework regarding the Merchant Discount Rate (MDR) would be limited to specific high-value business transactions and is not designed to burden everyday shoppers.
- The Nature of PSS Act Amendments: The recent legislative changes are categorised as "enabling provisions". These are intended to enhance cybersecurity, improve network stability, and prevent fraud rather than to impose immediate charges on individual users.
UPI Is India's Own Indigenous Innovation, Says Government
Myth: The amendment is being driven by external pressure.
UPI is India's own indigenous innovation. If outside pressure had shaped its journey, it would not have launched in 2016, stayed 100% free for citizens and merchants since 2020, or grown into the world's largest real-time… pic.twitter.com/Zn4IUwmTlK
— MyGovIndia (@mygovindia) August 9, 2026
Focus on a 'Future-Ready' Ecosystem
Government authorities emphasised that UPI remains an indigenous innovation that has maintained a free model for both citizens and merchants since 2020. With over 2,300 crore transactions recorded in July 2026 alone, the system has grown into one of the world's largest real-time payment networks. According to the official statement, continuous updates to the UPI framework are purely technical, aimed at keeping the network "safe, fast, and reliable." UPI Users Get Relief: No Charges on Payments, Most Merchants Stay Free.
Advice To Users
The government has urged the public to rely on official communications rather than unverified forwarded messages. There is currently no requirement for consumers to change their payment habits. For individuals concerned about specific updates, the government recommends visiting official portals for the most accurate and current information regarding digital payment policies.
(The above story first appeared on LatestLY on Aug 10, 2026 07:49 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).
