Making payments through a UPI (Unified Payments Interface) platform for free may soon be a thing of past. Kotak Mahindra has announced that it will be applying a fee on the Person to Person (P2P) fund transfer from May 1.
The bank has notified customers through an email that it will charge Rs 2.50 for every transaction worth Rs 1,000 or less and a fee of Rs 5 will be levied on transactions above Rs 1000, which will be applicable across all the UPI platforms including Paytm, PhonePe, Google Pay and others. However, all other customer payments of online shopping, transport services and bill payments would remain free irrespective of the banks and UPI platforms.
The UPI mode of payments have witnessed multifold growth in the country for its speed and convenience. With Kotak Mahindra applying a fees on the Person to Person (P2P) fund transfer, it’s highly likely that other banks will follow suit.
The chief communication officer of Kotak Mahindra Group, Mahindra Rao, told The Hindu, “We continue to promote UPI as a convenient way to pay. More than 95% of our customers do an average of 5-10 UPI transactions per month. While we continue to offer the first 30 P2P UPI transactions per month at no cost, charges are being introduced only for all subsequent UPI P2P fund transfers, beyond the monthly 30 free transactions. This is intended to prevent abuse of the UPI system and will not impact genuine customers. Receiving money through UPI as well as all merchant transactions continue to be free.”