Mumbai: Google Pay, one of the leading Unified Interface Payments (UPI) platforms, has introduced a convenience fee for bill payments, such as those for electricity and cooking gas, charging customers who have hitherto been using the avenue for free when making low-value transactions. To be sure, the charges apply to payments made with credit and debit cards, with fees ranging from 0.5% to 1% of the transaction value, plus the applicable goods and services tax (GST).
This follows Google Pay's earlier decision to introduce a ₹3 convenience fee for mobile recharges over a year ago.
In one instance that ET reviewed, a customer was charged about ₹15 as "convenience fee" when paying an electricity bill using a credit card. This fee was also labelled as a "processing fee for debit and credit card transactions" and included GST.
"Google Pay's introduction of platform fees for bill payments signals a broader shift toward monetising UPI transactions as service providers seek ways to offset the costs of processing payments," said a person with knowledge of the matter. "As UPI adoption grows, fintech companies are trying to balance growth with sustainable revenue generation." According to a PwC analysis, stakeholders incur costs of nearly 0.25% of the transaction value for processing UPI person-to-merchant transactions. Google Pay did not respond to queries sent by ET.
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In one instance that ET reviewed, a customer was charged about ₹15 as "convenience fee" when paying an electricity bill using a credit card. This fee was also labelled as a "processing fee for debit and credit card transactions" and included GST.
"Google Pay's introduction of platform fees for bill payments signals a broader shift toward monetising UPI transactions as service providers seek ways to offset the costs of processing payments," said a person with knowledge of the matter. "As UPI adoption grows, fintech companies are trying to balance growth with sustainable revenue generation." According to a PwC analysis, stakeholders incur costs of nearly 0.25% of the transaction value for processing UPI person-to-merchant transactions. Google Pay did not respond to queries sent by ET.
