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Consumers in the nation are using UPI for a wide range of transactions, from buying vegetables to purchasing airline tickets, and the number of these digital financial transactions is continuously rising. Due to its simplicity and security, UPI has become more and more popular; nevertheless, talks about putting levies on these transactions are now taking place.

There are worries that more transactions will soon be impacted since UPI service providers have already started collecting fees for cellphone recharges. Given this, ‘Local Circle’ carried out a study to find out how consumers felt about possible UPI transaction fees, and the results were unexpected.

Most Users Might Give Up on UPI Due to Transaction Fees
According to a Local Circle poll, 75% of consumers would stop using the UPI service if transaction fees were introduced. According to the research, 38% of users choose UPI over debit and credit cards or other digital means for 50% of their financial transactions. Remarkably, just 22% of UPI users are open to paying more for transactions. 42,000 UPI users in 308 districts throughout the country participated in the poll, which revealed a variety of answers to each question.

Transaction Volume on UPI Rises by 57%
Local Circle got 15,598 answers to inquiries about UPI transaction costs. For the fiscal year 2023–24, the National Payments Corporation of India (NPCI) revealed an astounding 57 percent growth in transaction volume and a 44 percent surge in value over the prior year. Notably, UPI transactions increased from Rs 84 billion in 2022–2023 to Rs 131 billion in 2023–2024—crossing the 100 billion barrier for the first time. The study further states that the total transaction value increased from Rs 139,100 billion to Rs 199,890 billion.

UPI Is Increasingly Important to Many Users
37 percent of users perform 50 percent of their overall transactions using UPI, according to the poll. This demonstrates that 4 out of 10 consumers are increasingly using UPI as their primary payment method, which has led to substantial hostility to any direct or indirect fees associated with UPI transactions. To make sure UPI users’ views are taken into account before enacting any MDR fees, Local Circles intends to submit the survey findings to the Finance Ministry and the Reserve Bank of India (RBI). Online responses to the survey were accepted from July 15 to September 20.