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UPI transactions: NPCI s volume cap circular: Will limits on UPI transaction volumes impact India s fintech sector?

Synopsis Being the sole umbrella organization for retail payments in India, NPCI is in a dominant position. Given the current regulatory framework, UPI would be considered to be an essential facility which cannot be recreated by NPCI’s competitors. The need of the hour is a consultative solution-based approach to address the many uncertainties in respect of NPCI’s new thrust for digital payment apps. The National Payments Corporation of India (NPCI) released the “Guidelines on volume cap for Third Party App Providers (TPAP)” (Circular). As per the Circular, effective January 1, 2021, TPAPs are required to ensure that the total volume of transactions initiated through their respective Unified Payment Interface (UPI) applications do not exceed 30% of the total volume of transactions in the country during the preceding three months.

SBI Collected Rs300 crore from Zero Balance Accounts in 5 Years: IIT Bombay Study

 1 A new study by IIT Bombay has revealed that several banks, including State Bank of India (SBI), have been imposing excessive service charges on zero-balance or basic savings bank deposit accounts (BSBDA). In fact, SBI alone collected almost Rs300 crore over the past five years from these zero-balance or basic accounts.    The study observed that the SBI’s decision to levy a charge of Rs17.70 for every debit transaction beyond four by the BSBDA account-holders cannot be considered as reasonable. It is usually the poorer people and students who are fleeced and this continues even now in a year-long COVID situation when things have been rough and the poorer sections have borne the worst brunt of lock-downs and restrictions.  

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