India has delayed plans to introduce merchant fees on its Unified Payments Interface (UPI) digital payments network. The National Payments Corporation of India (NPCI), which operates UPI, announced on Tuesday that the planned October 15 rollout of a 0.4% fee on eligible merchant transactions over ₹2,000 (about $21) would be postponed.
The NPCI cited the festive shopping season as the reason for the delay. The fee, which was announced last month, had faced significant pushback from merchants across the country, including retailers and petrol pump operators, some of whom warned they might stop accepting UPI payments.
The rollout is now scheduled to occur after Diwali, a major Indian festival and shopping period, though a new specific date has not been provided by the NPCI. UPI processed 24.07 billion transactions worth ₹29.37 trillion (about $305 billion) in September alone.
The proposed fee aimed to make the digital payments business more profitable for companies facilitating the service, which has been largely dominated by Google and PhonePe. For years, India has maintained a policy of keeping UPI payments free for merchants, a factor that has supported the network's growth.