On August 6, the Lok Sabha passed a bill amending Section 10A

Why in news

The Lok Sabha passed a bill to amend Section 10A of the Payment and Settlement Systems Act, 2007, to allow the National Payments Corporation of India (NPCI) to charge fees for UPI transactions.

Background

The bill seeks to amend the Payment and Settlement Systems Act, 2007. Currently, UPI costs the NPCI up to ₹20,000 crore annually. The government intends to keep low-value payments free while potentially charging for others.

Facts for Prelims

• Act / BillPayment and Settlement Systems Act, 2007: Governs electronic payment systems in India.
• BodyNPCI: The umbrella organization for operating retail payments and settlement systems in India.
• FactUPI annual cost: Currently estimated at up to ₹20,000 crore.
• S&TUPI: A real-time payment system developed by NPCI.

For Mains

Q. Discuss the implications of introducing transaction fees on UPI for financial inclusion and the sustainability of India's digital payment infrastructure.

Dimensions to cover in your answer

• financial inclusion impact
• NPCI's fiscal sustainability
• regulatory framework for fintech
• consumer protection

Keywords: Digital Public Infrastructure · Financial Inclusion · Monetization · Payment Gateway · Statutory Framework

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