India postpones UPI payment fee rollout until after Diwali festival

India has pushed back the start of a fee on large payments made through its Unified Payments Interface, according to Business Recorder, which cited a statement from the National Payments Corporation of India on Tuesday. The 0.4 per cent charge on merchant transactions above 2,000 rupees, worth $21, had been scheduled to take effect on October 15. The NPCI said the new date will be announced separately and the charge will follow soon after the Diwali festival.

The fee would have ended more than six years of zero-cost payments, and retailers had objected to the plan. The Confederation of All India Traders called the postponement timely and pragmatic, following a meeting in which about 20 trade industry representatives met the finance minister on September 30. Reuters had reported last week, citing sources, that the delay would let payments firms upgrade systems without passing costs on to customers.

Shares of digital payments companies Paytm, Pine Labs and One MobiKwik Systems rose after the announcement, with gains of 1 per cent, 1.8 per cent and 1.3 per cent respectively. Rahul Jain, research director at Dolat Capital, said the notice removes uncertainty over when the merchant discount rate will apply and described this as favourable for the companies. No company listed on the Pakistan Stock Exchange is named in the report, so the development offers context rather than a direct holding for local investors.