CONNECT WITH US
Fintech

Fintech

Indian Consumers Embrace Cash Ahead of New Instant Payment Fees

PYMNTS – Fintech logo

Published on

Add as a preferred source on Google
Indian Consumers Embrace Cash Ahead of New Instant Payment Fees

Indian consumers are reportedly increasing their cash usage ahead of new fees on the country’s popular digital payment system.

Complete the form to unlock this article and enjoy unlimited free access to all PYMNTS content — no additional logins required.

Beginning next month, the United Payments Interface (UPI) system will apply a small fee on all transactions greater than 2,000 rupees, or around $21.

But as the Financial Times (FT) reported Sunday (Oct. 18), that change isn’t sitting well with Indian businesses. The report cited a survey from polling agency Local Circles showing that 83% of merchants were not willing to bear the additional costs.

The report said this fee could be a blow to the 10-year-old UPI, one of the world’s most widely used digital payments systems.

As FT noted, the launch of UPI coincided with a government effort to take large denomination bills out of circulation. However, use of physical currency has remained popular, with around 2.3 times as much cash in circulation now than 10 years ago.

Please add us to your preferred sources list so our news, data and interviews show up in your feed. Thanks!

“Currency in circulation continues to grow at double-digit rates even as cash’s share of individual transactions declines, thanks to growing digital payment adoption,” Reserve Bank of India (RBI) Deputy Governor Shirish Chandra Murmu told FT, referring to this dynamic as the “cash paradox.”

Meanwhile, uptake of UPI has also soared as a way to pay vendors, cover groceries or restaurant bills, and make money transfers.


Source link
Related Topics:Fintech

Disclaimer

We strive to uphold the highest ethical standards in all of our reporting and coverage. We TheMorningPulse.fyi want to be transparent with our readers about any potential conflicts of interest that may arise in our work. It's possible that some of the investors we feature may have connections to other businesses, including competitors or companies we write about. However, we want to assure our readers that this will not have any impact on the integrity or impartiality of our reporting. We are committed to delivering accurate, unbiased news and information to our audience, and we will continue to uphold our ethics and principles in all of our work. Thank you for your trust and support.