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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.)

Symbol of political pride, power and pragmatism

Quaid Najmi
Jan 28
2 min read

Mumbai: Ajit Ashatai Anantrao Pawar - who straddled Maharashtra’s political landscape like a colossus for nearly 45 years - was snuffed out in a plane crash in Pune early on Wednesday, plunging his Nationalist Congress Party (NCP) into precarity and the ruling Mahayuti government into turmoil.


The nephew of Nationalist Congress Party (SP) President Sharad Govindrao Pawar, Ajit Pawar was 66 and is survived by his wife Sunetra, an MP, and two sons, Parth and Jay. Parth, a wannabe politician, is a bachelor, while Jay married Rutuja Pravin Patil in December 2025.


Born with a ‘political silver spoon’ into the formidable Pawar family, Ajit Pawar’s political trajectory spanned Baramati’s village politics to the cooperative sector, and then to state - and briefly, national - roles. The crowning glory of his career was - being elected Deputy Chief Minister a record six times.


The ‘Pawar-ful’ surname raised towering expectations from Ajit Pawar, thanks largely to his 'Kaka', Sharad Pawar’s ascent as the state’s youngest Chief Minister at the age of 38 in 1978. Yet, Ajit Pawar had to struggle for years to carve an independent niche under Sharad Pawar’s ever-looming giant penumbra, finally emerging from the long eclipse in July 2023 following a vertical split in the NCP.


Humble Grassroots

Rising from humble grassroots political engagement, he quickly grasped the pulse of rural Maharashtra and the state’s political dynamics, especially during the era of coalition politics that has dominated the scene for over a quarter century.

Ajit Pawar concentrated his official power on initiatives ranging from roads, dams and irrigation networks to tough financial decisions. Aided by his brash bluntness style of functioning, a loafing officialdom sprang into action to avoid his dark scowls or wrath.


Over decades as an MLA (eight times), MP and in other key positions, Ajit Pawar mastered the art, science and mechanisms of governance - the movement of files, the working of departments, how decisions are translated into policy and finally implemented to reach the last man standing.


En route, his decisions courted multiple controversies and dubious charges, yet he dashed towards his destinations unperturbed. These included corruption allegations, big and small intra-party and external political confrontations, and his unabashed yet unfulfilled desire to become Chief Minister - all of which marked him as an all-weather survivor.


Iron Control

A retired official recalled his iron control over the bureaucracy, especially during his tenure handling the critical Finance portfolio of the country’s largest state economy. He focused sharply on rural road infrastructure, irrigation projects, water supply schemes, and extensive canal and dam networks.


These initiatives were coupled with strict fiscal discipline, firm budgeting and a ringmaster-style implementation - a tribute to his administrative acumen and efficiency. However, in recent years, he succumbed to realpolitik pressures that not only raised question marks but also catapulted the state’s debt burden to record highs, but he airily brushed aside all censure.

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