UPI Transaction Charges: ICICI Bank is now going to charge transaction fees from payment aggregators (PAs) on UPI payments. This new rule can come into effect from August 1, 2025. Earlier, Yes Bank and Axis Bank have also done this
UPI Transaction Charges: ICICI Bank is now going to charge transaction fees from payment aggregators on UPI payments. This new rule can come into effect from August 1, 2025. Earlier, Yes Bank and Axis Bank have also done this.
How much will be the charge?
If a PA maintains an escrow account in ICICI Bank, then a charge of 2 basis points (0.02%) will be levied on every transaction. Its maximum limit will be Rs 6 per transaction. PAs who do not have an escrow account in ICICI will be charged 4 basis points (0.04%). In this case, the maximum charge has been fixed at Rs 10 per transaction.
Who will not be charged?
If the transaction is settled directly in the merchant’s ICICI Bank account, then there will be no charge.
Other banks are already charging charges
Other banks like Yes Bank and Axis Bank have been charging PAs for UPI transactions for the last 8–10 months.
Why is this charge being levied?
Although the government has kept the Merchant Discount Rate (MDR) on UPI at zero, NPCI i.e. National Payments Corporation of India charges a switch fee from banks. Some banks are recovering this cost from payment aggregators.
What will be the impact on merchants?
Payment aggregators usually charge merchants in advance for services like platform fees, payment reconciliation fees. In such a situation, the impact of ICICI’s new charge may reach merchants in the future. UPI may be free for customers, but banks are now moving towards recovering their expenses by charging fees from payment aggregators.
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