Know about the recent news on UPI to UPI payment charges in India. Find out what the 1.1% charge actually applies to and discover the difference between UPI and PPI. Get insights on how NCPI manages payment systems in India and the global recognition of the Indian UPI system. Avoid unnecessary charges on your transactions by reading this informative article.
The National Payment Corporation of India (NCPI) recently made headlines when news broke that it would levy a 1.1% charge on transactions made by small traders and vendors of ready-made tracks through UPI. However, the news is incomplete, and it has caused some confusion in the market. Here’s what you need to know about UPI to UPI payment charges.
Understanding the Charge
The 1.1% charge will only apply if a customer pays the vendor through UPI, and that payment goes to the vendor’s pre-paid payment account (PPI). In this case, the charge will be levied on the payment made. However, if the customer makes a payment from UPI to UPI or PPI to PPI, no charge will be levied.
What is UPI and PPI?
NCPI manages both UPI and PPI. UPI stands for Unified Payment Gateway, while PPI stands for Prepaid Payment Gateway. Examples of PPIs include Paytm Wallet, Amazon Wallet, and Airtel Wallet.
UPI is a payment system that enables instant money transfer between bank accounts using a mobile device. It is a real-time payment system that allows you to send and receive money instantly. PPI, on the other hand, is a prepaid payment instrument that can be used to make payments at select merchant locations.
Establishment of NCPI
NCPI was established in 2008 with the recommendation of RBI and Bank Association. It is responsible for managing payment systems and settlement in India. The Indian UPI system has received praise from around the world, with many countries expressing a desire to implement a similar system in their own country.
Conclusion
In conclusion, the recent news about the 1.1% charge on UPI transactions has caused some confusion in the market. However, the charge only applies if a payment is made from UPI to PPI. UPI to UPI and PPI to PPI transactions will not be charged. Understanding the difference between UPI and PPI is important, as it will help you avoid unnecessary charges on your transactions. With NCPI managing payment systems in India, the country’s payment infrastructure is in good hands, and the Indian UPI system is poised to become a global model for other countries to follow.
