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21 August 2024 at 10:20:16 am

Fee Signal

The government’s decision to create a legal framework for levying charges on UPI transactions has understandably triggered concern, even though it insists that ordinary users and small merchants will continue to enjoy free payments. The proposed amendment does not impose a fee on UPI today. But it removes the statutory barrier to one being imposed in the future, making the government’s reassurance less than the final word. The government argues that this is a measure for UPI’s long-term...

Fee Signal

The government’s decision to create a legal framework for levying charges on UPI transactions has understandably triggered concern, even though it insists that ordinary users and small merchants will continue to enjoy free payments. The proposed amendment does not impose a fee on UPI today. But it removes the statutory barrier to one being imposed in the future, making the government’s reassurance less than the final word. The government argues that this is a measure for UPI’s long-term sustainability. The world’s largest real-time payments system, which processed 2,366 crore transactions worth Rs. 29.9 lakh crore in July alone, cannot indefinitely depend on subsidies as transaction volumes, cybersecurity requirements and infrastructure costs rise. A nominal Merchant Discount Rate on larger merchant transactions, it says, would help create a more sustainable ecosystem without burdening ordinary users. That argument has merit. But so does the concern that a payment system which became a national habit precisely because it was cheap and frictionless should not slowly acquire a price tag. Once the legal machinery for charging exists, there is no guarantee that the boundary between large merchants and small ones, or between merchants and consumers, will remain permanently fixed. The Finance Minister has clarified that any Merchant Discount Rate will apply only to a limited set of merchant transactions above a threshold and will be nominal, well below card-payment rates. The details will eventually be decided by the UPI and Services Steering Committee headed by the National Payments Corporation of India. In other words, there is no charge on the table for the ordinary UPI user today. But there is now a legal mechanism for charges to be introduced tomorrow. That is precisely why any alarm, though exaggerated, cannot simply be dismissed. The government, through its clarification, has reassured that UPI’s free-to-consumer model remains intact. The important issue is whether its financing model can evolve without undermining the habits that made it revolutionary. UPI succeeded partly because it made digital payments cheaper and simpler than alternatives. There is also a larger principle at stake. UPI is not merely another commercial payments platform. It is the product of public investment, regulatory architecture and private innovation. The state should therefore be wary of treating its sustainability as an ordinary market problem. The sensible answer lies between free-for-all subsidies and indiscriminate fees: transparent thresholds, genuinely low MDRs, strong protection for small merchants and an absolute firewall around ordinary consumers. The government should publish the economic case for any future charge, including its effect on merchants and consumers. UPI was built on trust as much as technology. The government is right to protect its remarkable achievement. It should remember that keeping UPI free is not merely a political promise. It is part of the product.

CJP Must Remain as Watchdog

After forcing Dharmendra Pradhan’s resignation, the Cockroach Janata Party faces a defining choice: remain an independent citizens’ watchdog or risk losing its credibility by entering electoral politics.

Minutes after Dharmendra Pradhan resigned ‘on his own’, a friend from Delhi who understands politics very well called me in an exalted voice. Having followed Indian politics closely for over 60 years, the businessman felt the Cockroach Janata Party (CJP) would win 100 seats across India in the next general elections considering the zenith it had reached in popularity.


He also had valid reasons to offer in support because he detests BJP’s overall governance in New Delhi and in states like MP or Maharashtra, despite having had good friends within the saffron party. I instantly disagreed.


Knee-Jerk Response

The CJP is a very young grouping, having been born in May this year, as a knee-jerk response to the weird and shocking comment by Chief Justice of India Surya Kant while hearing a petition. What may have prompted Abhijeet Dipke to swiftly post on X, asking, “What if all cockroaches come together?”, is not known. But the non-political platform opposing the “rotten system” came together before you could even spell cockroach.


It is a fact that while the Bharatiya Janata Party (BJP) and its Government at the Centre suffered greatly in the process, the remark came from none of its leaders who are otherwise known for insulting anyone and uttering anything at any time. The power-drunk BJP leaders have embarrassed the party umpteen times, not even sparing women army officers or women wrestlers.


However, in this case, it was a top judicial officer of the country who triggered a storm and Pradhan became the scapegoat. Of course, I have no sympathy whatsoever for the former Union minister because he was clearly incapable of handling a ministry which was headed by political stalwarts like Narasimha Rao, MM Joshi, Arjun Singh and Madhavrao Scindia in the past. The CJP was thus born in the Supreme Court, brought up in Boston where Dipke was studying and started running at Jantar Mantar in June. Everything happened with electrifying speed.


Having claimed the scalp of Pradhan after a long-drawn struggle, the Gen Z has heightened the expectations of millions who are victims of poor governance and corruption. CJP must function as a fierce watchdog.


Farmers, students, businessmen, women, the middle class and those who are ideologically anti-BJP all see a ray of hope in CJP to check corrupt practices and make BJP accountable. This is because Rajnath Singh, whom I personally like, is a seasoned and honest leader of the party and one who talks less. Yet, in another context, he made that pompous statement “NDA me istiphe nahi hote” (None resigns in NDA regime). CJP capitalized on it while setting a single-point agenda of its unique protests in New Delhi in June.


Bad Governance

Examination paper leaks, similar to the shady Vyapam scam of Madhya Pradesh, are crimes governments committed against the lives of students and job-seekers. In both cases it was BJP under which it all happened. BJP has always talked in glowing terms about its ‘good governance’. Paper leaks and Vyapam were specimens of bad governance of the highest order.


Dipke and his core group were intelligent enough to pick the pulse of students and parents and carefully launched the massive agitation which grew by the day to spread across the country. But now they should stop, look back and reorganize their strategies.


As I see it, CJP has now emerged as a solid pressure group that took up the issue of a totally collapsed education system, headed by Pradhan since 2024. How well-knit a force CJP will remain in the months to come is yet to be tested. But they should be thanked for reopening the blocked path of peaceful demonstrations in the country for exposing the wrongs.


There are already ideas floating and, as my friend hinted, some of the CJP members are nursing political ambitions.


I strongly feel that CJP must abhor politics. It should remain what it is—an altruistic platform to set wrong things right in sectors like education, health and the environment.


Everyone knows Dipke has links with the AAP and Arvind Kejriwal but he has been able to create an apolitical image today which is unmatchable.


The way Kejriwal and his party have performed over the last few years is a burning example of what happens when activists turn into politicians in India’s hopeless political system. Raghav Chadha’s case is another example. He did not utter a single word on students’ and Gen Z’s concerns for which he was well-known before joining the ruling BJP. Elected politicians are meant to raise their voices for the people when they need them but the otherwise vocal RS member, Chadha, was hidden deep inside an unseen burrow.


If CJP becomes a political party, it will run the risk of getting sucked into the quagmire of dirty Indian politics. It should resist that temptation, for it cannot match the cunning of the BJP, the Congress or the NCP.


(The writer is a senior political and environment journalist based in Bhopal. Views personal.)

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