How is UPI free?

UPI is free for users because the Government of India has mandated a zero-charge framework for Unified Payments Interface transactions. Managed by the National Payments Corporation of India (NPCI), this initiative aims to promote digital payments and financial inclusion. Key reasons include:

• Zero Transaction Fees: End-users are not charged any fees for person-to-person (P2P) or small merchant (P2M) transactions.
• Digital Public Good: UPI is classified as a digital public infrastructure, prioritizing social and economic growth over direct revenue.
• Merchant Subsidy: The government often provides support to banks to offset costs, ensuring the ecosystem remains cost-free for common citizens.