A recent directive from the National Payments Corporation of India (NPCI) has ignited a political debate in New Delhi, following the introduction of a 0.4 per cent charge on certain UPI merchant transactions exceeding Rs 2,000. The ruling Bharatiya Janata Party (BJP) has defended the digital payments ecosystem, while the Nationalist Congress Party (Sharadchandra Pawar) [NCP(SP)] has sharply criticised the move.
BJP MP Anurag Thakur swiftly reacted to the proposed charge, highlighting India's digital payments system as a globally recognised success story. Thakur emphasised its widespread adoption, noting, "India's digital transactions are now cited as an example across the world. Prime ministers and presidents of major countries come to India and see how easily even a roadside vendor, tea seller, small shopkeeper, and individuals can make payments through digital transactions." He also criticised the Congress party's response, suggesting a more detailed examination of the report was necessary rather than immediate criticism. Thakur clarified that transactions up to Rs 2,000 remain exempt, adding, "You do not have to pay anything on transactions up to Rs 2,000, and there is no transaction charge on 96 per cent of items even above that amount…"
Conversely, NCP(SP) leader and National Spokesperson Clyde Crasto slammed the Central government, arguing that merchants would inevitably pass this additional cost onto consumers. Crasto stated, "The Bharatiya Janata Party government at the Centre has found yet another way to trouble people. Now they are saying that a tax will be imposed on UPI transactions." He questioned the practicality of expecting shopkeepers to absorb the cost, adding, "If a person makes a purchase, the shopkeeper will have to pay the tax. And they say that the shopkeeper will pay this tax. Tell me, which shopkeeper will pay it out of his own pocket? Why would he take that burden? Somewhere, he will find a way to pass that burden on to the customer who is making the purchase."
The controversy stems from a circular issued by NPCI on Tuesday. This circular mandates that most merchants will pay a 0.4 per cent charge to banks and payment processors for UPI payments they receive that exceed Rs 2,000 per transaction. This development holds particular significance given UPI's pervasive use for everyday transactions, including those involving small retailers, vendors, and various other merchants across the nation.
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📰 Source: Mangalorean News