reserve Bank of India
The Reserve Bank of India (RBI) will work on ways to make the country’s most popular digital payments platform Unified Payments Interface (UPI) sustainable in the long run and strengthen its technical infrastructure. RBI Governor Sanjay Malhotra said this while talking to the media on Friday after the announcement of February monetary policy. He said that UPI is a unique and very important payment system for India, which will be further improved in the coming years.
Focus on customer convenience and trust
The Governor said that improving the infrastructure will help in removing the problems faced by the customers. As transaction pressure on UPI is increasing, it has become necessary to strengthen the stability, speed and security of the system. RBI believes that without strong infrastructure it may be difficult to run this large digital ecosystem smoothly.
Debate on free UPI and MDR
At present UPI is almost free for common users and merchants. The government pays the expenses of UPI transactions to banks through the budget, because digital payments reduce the use of cash. However, banks and payment companies associated with UPI have been demanding for a long time to impose Merchant Discount Rate (MDR), so that this platform can become financially self-reliant. The government has not yet accepted this demand considering the sensitivity of about 50 crore users.
provision of incentives in the budget
In the Union Budget 2026-27, the government has set an incentive of Rs 2,000 crore to promote low-amount UPI and RuPay Debit Card (P2M) transactions. This amount is distributed among banks, payment service providers and third party apps. However, this amount is slightly less than the revised estimate for the current financial year.
record transaction data
The government recently told Parliament that in the current financial year till December, record transactions worth Rs 230 lakh crore have taken place through UPI. This figure shows that UPI has become the backbone of the Indian digital economy. RBI’s focus is now on making it safe, strong and sustainable in the long run.