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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.)

Trouble in the House of Shinawatra

Jul 2, 2025
3 min read

Thailand’s youngest prime minister stumbles as scandal, street protests and economic woes collide.

Thailand’s youngest and second-ever female prime minister, Paetongtarn Shinawatra, has found herself at the heart of a familiar storm: scandal, instability, and whispers of yet another coup. Just a year into her historic premiership, the 38-year-old scion of Thailand’s most polarising political dynasty has been suspended from office following the leak of a phone conversation with Cambodian strongman Hun Sen. The conversation, reportedly centred around a long-simmering border dispute, was explosive not for what was said but how it was said.


In the leaked clip, Paetongtarn appears to take a conciliatory tone on the cross-border tensions, which flared into deadly clashes in May, leaving at least one Cambodian soldier dead. That she referred to Hun Sen as “uncle” and called a senior Thai military commander her “opponent” only added fuel to the fire. Critics have accused her of betraying national interests; protesters have taken to the streets of Bangkok in droves. Her coalition, once touted as a phoenix-like return of the Shinawatra machine, has begun to crack. The defection of Deputy Prime Minister Suriya Jungrungreangkit, now acting as interim leader, is a blow that may prove fatal.


Few families have loomed as large over a democracy as the Shinawatras have over Thailand. The dynasty began with Thaksin, Paetongtarn’s father, a billionaire telecom tycoon who became prime minister in 2001 and governed with populist flair until he was ousted in a military coup in 2006. Since then, the family has remained both omnipresent and embattled. Thaksin’s brother-in-law briefly became prime minister in 2008, followed by his sister Yingluck, who met the same fate as Thaksin: deposed by the military in 2014. In 2023, Paetongtarn led the Pheu Thai party’s election campaign while heavily pregnant, only to fall short at the ballot box. But after the removal of Prime Minister Srettha Thavisin by Thailand’s Constitutional Court in August 2024, she was anointed by the ruling coalition as the compromise candidate. Her premiership, ratified in Parliament without contest, marked a generational handover - but one laced with peril.


Paetongtarn, or Ung Ing as she is affectionately known, was groomed for power in the shadows of Thai politics. At eight, she followed her father into foreign ministry corridors. At 20, she sheltered with her family in a safe house during the 2006 coup. Two years later, she watched her father flee into exile. But if these traumas left scars, they also instilled steel. Educated in Thailand and Britain, she worked in the family’s business empire before plunging into politics in 2021.


But the once-iron grip of the Shinawatra clan on rural and working-class voters has slackened. The 2023 general election marked the first time in over two decades that their party failed to dominate. In power, Paetongtarn has struggled to assert herself amid factionalism, elite suspicion, and rising public discontent. Her signature policy - a much-hyped digital wallet scheme to inject stimulus via cash handouts - remains undelivered. Meanwhile, the country’s economic woes have only deepened.


The SET stock index has plunged over 20 percent this year alone. Foreign investment is now fleeing in response to political instability and unresolved trade disputes. A volatile border and diplomatic faux pas with Cambodia will hardly help. Analysts worry that critical negotiations with the United States on tariffs and investment could be derailed. Businesses are in limbo. The public is losing patience.


The political arithmetic is no more encouraging. Paetongtarn’s suspension by the Constitutional Court has triggered a 15-day window during which the court will decide whether to dismiss her permanently. A no-confidence motion looms in Parliament. If it passes, it could precipitate an early election or a cabinet reshuffle that further sidelines the Shinawatras. The military, though officially aloof, is watching. Thailand has seen a dozen successful coups since 1932. In a country where uniforms often trump ballots, the risk of another is never far off.


What makes Paetongtarn’s position especially precarious is not just her youth, or even the dynasty she embodies, but the toxic polarisation of Thai politics. Royalists, old-guard generals, and conservative elites have long viewed the Shinawatras as interlopers, manipulating democracy to serve populist ends. Meanwhile, her supporters see her as the best hope for modernising the country and ending the cycle of coups and court interventions. But neither camp is ascendant today.


As Thailand edges closer to the precipice, Paetongtarn faces a brutal lesson: in Thai politics, it is not enough to inherit a name. One must also survive it.

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