RBI updates the transaction fee rates
A discussion paper was released by the Reserve Bank of India on 17th August, entailing 40 questions on levies and charges in the payment system on transaction fees through debit cards, credit cards, NEFT (National Electronic Funds Transfer), PPIs (Prepaid Payment Instruments), and UPI (Unified Payments Interface), among others. The feedback received by the public until October will be utilised in future policy-making and strategising.
A transaction fee is the charge paid by a business while processing a customer's payment to RBI or PSPs (Payment Service Provider). It is charged for every transaction and varies as per the amount and mode of payment.
The step was taken to mitigate consumer complaints on "high and non-transparent" charges, and to enforce reasonable yet competitive charges while ensuring an optimum revenue gain for the intermediaries.