With the over achieved success of UPI or Unified Payments Interface, now a question is disturbing us all. Whether UPI is going to be charged or remain free? But RBI had already ruled that no charges will be imposed on UPI. However, the major banks, as per RBI rules, have capped the number of transactions for savings accounts.
UPI Is Free But Up To Certain Limits
This conflict between the regulations, “can be overcome if the RBI takes over the costs of UPI payments just as it absorbs cost-of-currency transactions,” as per a report.
As per Ashish Das from IIT Bombay, some banks have limited the number of debits in savings accounts. For instance, Indian OverseasBank allows its savings account holders 50 free debit transactions in six months. Any withdrawal beyond this limit is charged at Rs 5 per transaction. Canara Bank allows four free debits in its basic savings account.”
Meanwhile, the Central bank has not asserted any views on this topic but has indicated that it may cap the number of outgoing transactions in savings accounts.
“On one hand, there is a regulation that advocates restrictions to the number of withdrawals, while on the hand, the RBI, through their financial inclusion strategy, has a vision of usage of financial services and to take the country towards a cashless society through digital means The two policies counteract each other”, Canara Bank.
The government and RBI have been bearing significant costs in printing and management of currency. Over the past few years, they have spent, on average, Rs 5,400 crore annually, they have spent, on average, Rs 5,400 crore annually on printing and even more on currency management. The expenditure towards UPI may be much lower and could even curtail the expenditure on cash,” said RBI Governor Shaktikanta Das.