National Payments Corporation of India (NPCI) explained that bank account-to-account transfers continue to remain free for customers and merchants. According to that business, interchange fees only apply to UPI transactions completed with PPI wallets. NPCI recently issued guidelines that allowed prepaid payment Instruments (PPI wallets) to be part of the interoperable UPI ecosystem.

"NPCI has now permitted the PPI wallets to be part of the interoperable UPI ecosystem," the company said in a press release. "The interchange charges introduced are only applicable for the PPI merchant transactions and there is no charge to customers, and it is further clarified that there are no charges for the bank account to bank account based UPI payments."

Every month, over 8 billion transactions are processed free for customers and merchants using bank accounts. Traditionally, the most preferred method of UPI transactions is linking the bank account in any UPI-enabled app for making payments which contribute over 99.9% of total UPI transactions.