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By:

Sumit Ranjan Das

21 August 2024 at 4:08:59 pm

UPI Must Stay Free

AI Generated Image Yesterday, I went to my neighbourhood shop to buy aloo chop and vegetable chop to eat with muri. I reached for my phone to pay by UPI, as I do for almost everything. The shopkeeper stopped me. “This is the last time we’ll accept UPI. From tomorrow, CASH ONLY.” I didn’t argue or explain that payments up to Rs. 2,000 remain free. It would have been a waste of breath. So I let it go, but I kept thinking about it on the walk home because I think I know what he was afraid of....

UPI Must Stay Free

AI Generated Image Yesterday, I went to my neighbourhood shop to buy aloo chop and vegetable chop to eat with muri. I reached for my phone to pay by UPI, as I do for almost everything. The shopkeeper stopped me. “This is the last time we’ll accept UPI. From tomorrow, CASH ONLY.” I didn’t argue or explain that payments up to Rs. 2,000 remain free. It would have been a waste of breath. So I let it go, but I kept thinking about it on the walk home because I think I know what he was afraid of. Picture a vegetable vendor with a pushcart at the corner of your lane. Call him Ramesh. He studied up to Class 8. Two years ago, he put a QR code on his cart because someone told him one thing: “Bhaiya, UPI is free. The money comes straight to your bank.” That one sentence did more for Digital India than any seminar. No card machine, no fee, no paperwork. Now tell Ramesh that a Merchant Discount Rate (MDR) may apply to specified transactions above Rs. 2,000, subject to exemptions. He won’t argue. He will put up a board: CASH ONLY. MDR is the fee a merchant pays to accept a digital payment, and UPI has been free for merchants since 2020. The new framework proposes a fee of 0.4 per cent on specified merchant transactions above Rs. 2,000, with a cap of Rs. 300 on transactions above Rs. 75,000. Payments up to Rs. 2,000 remain free. Person-to-person transfers are not covered, and under the announced plan, customers are not charged directly. On a Rs. 10,000 merchant payment, the merchant would pay Rs. 40. Small merchants receiving less than Rs. 1,00,000 a month through UPI were proposed to be exempt. One report adds that the committee was reportedly considering exempting businesses with annual turnover of up to Rs. 40 lakh. On October 13, the National Payments Corporation of India (NPCI) said the fee, due to be implemented on October 15, would be introduced immediately after Diwali, on a date to be notified separately. The decision merley postpones the fee. Consider Ramesh again. Suppose he sells Rs. 5,000 worth of vegetables a day, mostly through payments of Rs. 30 to Rs. 300. That amounts to around Rs. 1,50,000 a month, or roughly Rs. 18 lakh a year. Every one of his payments is below Rs. 2,000, so under the proposal, they remain free. But his monthly receipts exceed Rs. 1 lakh, which means he cannot simply assume that the small-merchant exemption covers him. Who will tell him? Who will explain it in Bengali, Hindi or Maithili, at his cart, in two minutes? A vendor who cannot understand the rules will choose the option that feels safest: cash. Cash is not the enemy. But for a small merchant, it also means hunting for change and losing customers who do not have it, facing the risk of theft, loss and counterfeit notes, spending time counting, storing and depositing money, and having fewer digital records to show a bank when seeking credit. “Free” does not mean UPI costs nothing to run. Security, fraud control, banking systems and customer support all require money. In March 2025, the Union Cabinet approved an incentive of Rs. 1,500 crore for low-value BHIM UPI merchant transactions for the financial year 2024–25. Genuine welfare must never be treated as a piggy bank. Every rupee, whether spent on welfare or infrastructure, should deliver greater value. Five measures would help keep UPI simple. First, person-to-person UPI transfers must remain free. Sending money to family should never come with an unexpected charge. Second, protection for small merchants must be straightforward. Thela-walas, tea stalls and kirana shops need one clear exemption, not five clever ones. Third, UPI must be funded transparently. The government and relevant institutions should publish what it costs to run the system, how much public money supports it, how much any proposed fee collects and what results follow. Fourth, the rules must be explained in local languages. A one-page notice or a short voice message through a payment app would reach Ramesh faster than a 20-page circular. Finally, the impact must be measured before any fee is extended. Changes in small-merchant acceptance and transaction volumes should guide the next step. India did not build UPI by making it clever. It built it by making it simple and free. (The writer is a Cost and Management Accountant and founder of TaxoDas. Views personal.)

Delay, Discretion and a Legal Grey Zone

Apr 14
3 min read

Why Vice-Chancellor appointments stalled in the state

AI generated image
AI generated image

Kolhapur: A pattern of prolonged delays in appointing vice-chancellors across Maharashtra’s state universities is raising questions that go beyond administrative inefficiency, touching upon legality, governance, and academic fallout. With key posts lying vacant for months and interim arrangements becoming the norm, the issue now sits at the intersection of constitutional responsibility and regulatory compliance.


At the heart of the problem is a paradox: while university laws clearly mandate a time-bound selection process, the final authority responsible for approving appointments — the Chancellor’s office, vested in the Governor — is itself seen as a bottleneck. In several cases, vice-chancellor posts have remained vacant for over six months after incumbents demitted office, disrupting academic and administrative continuity across hundreds of affiliated institutions.


The situation is evident in universities such as Shivaji University, Maharashtra University of Health Sciences, and Dr Babasaheb Ambedkar Technological University, where either the posts remain vacant or additional charge has been handed to vice-chancellors of other universities. This stop-gap arrangement, critics argue, discourages long-term decision-making, leading to policy paralysis and a pile-up of pending files.


Legally, the Maharashtra Universities Act envisages that the process of appointing a new vice-chancellor should be completed before the incumbent’s tenure ends. A search committee constituted under statutory provisions screens candidates and recommends a panel to the Chancellor, who makes the final selection. However, this process has increasingly failed to adhere to timelines, undermining the intent of the law.


Unfilled Posts

The implications are structural. Vice-chancellors are central to appointing pro-vice-chancellors, deans, and other academic heads. Delays at the top cascade downwards, leaving key academic and administrative posts unfilled. The result is a disruption in governance and a dilution of academic quality, at a time when universities are expected to compete globally on research output and institutional standards.


Adding another layer of complexity is the mismatch between state laws and the evolving regulatory framework of the University Grants Commission (UGC). Under the UGC Act, 1956, any changes in central regulations — particularly concerning the composition of search committees — are expected to be reflected in state university laws. However, Maharashtra has not aligned its legislation with recent UGC norms for state universities, even though similar changes have been adopted for private universities.


Legal Vulnerability

This divergence has created a potential legal vulnerability. The continued inclusion of state government officials, such as education secretaries, in search committees — contrary to revised UGC guidelines — raises concerns about both the autonomy of the selection process and the scope for political influence. Experts warn that such deviations could render appointments open to judicial challenge, a scenario that has precedent in courts across the country.


The broader concern is political. Allegations of ideological preferences shaping appointments are not new, but the UGC’s revised framework sought to insulate the process by redefining the composition of search committees. Maharashtra’s reluctance to implement these changes for state universities has therefore intensified scrutiny.


Meanwhile, the academic cost continues to mount. In a higher education ecosystem already grappling with limited funding and global competitiveness challenges, governance gaps only deepen institutional fragility. India’s struggle to place more universities among the world’s top 500 underscores the urgency of systemic reform.


Policy Paralysis

The contrast within the state is telling. While private universities, governed by updated laws, have largely managed smoother appointments, state universities remain mired in delays and procedural ambiguities. This duality not only reflects policy inconsistency but also raises questions about intent.


Ultimately, the issue is one of accountability. If delays persist despite clear legal provisions, and if statutory changes mandated by national regulators remain unimplemented, the responsibility cannot remain diffused. Whether the bottleneck lies in bureaucratic inertia or political calculation, the cost is being borne by institutions and students alike.


As the possibility of legal challenges looms and academic uncertainty deepens, Maharashtra’s higher education system faces a pressing question: can governance reforms keep pace with regulatory mandates, or will delays continue to define the state’s university landscape?


“Under the 2018 regulations approved by the University Grants Commission, it is mandatory for all universities to amend their laws in line with the revised norms for search committees and implement them,” he said. “While Maharashtra has incorporated these changes in the private universities law, state universities continue to follow the old procedure. If legally challenged, such appointments may not stand scrutiny and could be declared invalid.”

Dr Manikrao Salunkhe, Former President, Association of Indian Universities


“The delay in appointing Vice-Chancellors is impacting the growth of universities. Policy decisions are stalled and key issues remain unresolved,” he said. “Vice-Chancellors holding additional charge often limit themselves to routine remarks on files rather than taking decisive action.”

Advocate Ashwinkumar Mithari, Member, Senate of Shivaji University

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