Will you ditch digital?
A ₹5 fee that
does not exist.
Merchant discount rates apply to businesses, not to payers. Most people surveyed believe the opposite — and the workarounds they describe are real even when the fee is not.
Explore the findingsThe rumour travels further
than the policy does.
Expect a direct ₹5 consumer fee on UPI transfers above ₹2,000.
Report pp. 7–8High propensity to break a ₹2,500 payment into sub-threshold transfers.
Report pp. 12–13Return to normal high-value UPI use after being told consumers pay nothing.
Report pp. 17–18This is a study of belief, not of policy. Under the NPCI framework referenced in the questionnaire, standard consumer transfers carry no direct charge; every fee in the scenarios tested is hypothetical. All figures are stated intent, not observed transaction data.
A fee that does not exist, and the damage it does anyway.
Merchant discount rates are a business cost. Most people surveyed believe they are a personal one — and the workarounds they describe because of that belief would be entirely real if a fee ever appeared.
This is a communication failure, not a pricing problem. A single plain-language correction recovers most of the lost intent — but a stubborn third hold on to their doubt, including people who were never misinformed in the first place.
The rumour beat the policy
Expect a direct ₹5 debit on transfers above ₹2,000, and 44.3% think the charge leaves their own account. Awareness of the threshold is near-universal — 66.3% already knew about it — but the conclusion attached to it is wrong.
The response is gaming, not quitting
Would split a ₹2,500 bill into sub-threshold transfers rather than abandon UPI. That doubles transaction volume instead of reducing it, so the exposure lands on merchant queue time and settlement reconciliation.
Cash is the fallback, not cards
First choice if UPI carried a fee, ahead of credit cards (28.7%) and debit cards (11.0%). Friction pushes volume out of the formal digital system rather than across it — cash outranks all three electronic alternatives combined.
A ₹5 fee is tolerable in isolation
Would still pay on a ₹2,500 ticket, and 75.0% agree convenience outweighs the charge. This sits directly at odds with the breaking-point framing elsewhere in the source; frustration (77.7%) and abandonment are not the same behaviour.
One clarification recovers most of it
Return to normal high-value use after being told consumers pay nothing. Among the 208 misinformed respondents, 138 fully abandoned plans to switch or split — and only 6 were immovable.
A third stay only partly reassured
Including half of the 90 respondents who already knew payments were free. Correcting the mechanism does not remove the expectation that a charge turns up eventually, which is why one-off announcements underperform.
Treat this as an interface problem, not a PR one. Put a persistent “no fee to you” confirmation inside the payment screen on transfers above ₹2,000, where the doubt actually surfaces. Enforce zero-surcharge compliance at the counter, since cash is the default escape route. And plan for split-tendering rather than churn — the volume does not disappear, it fragments.
Active transactors, evenly split, widely spread.
The sample is drawn from people already using UPI for high-value payments. That matters: these are the users a fee rumour has the most to cost, and the ones most likely to have heard it.
Who took part
Gender composition · n=300
High-value transaction frequency
How often respondents send more than ₹2,000
| Response | Respondents |
|---|---|
| Multiple times a week | 59.3% |
| At least once a week | 34% |
| 1 to 3 times a month | 6.7% |
Leading cities
Metro core with a long regional tail
| Response | Respondents |
|---|---|
| Delhi | 8.3% |
| Kolkata | 6.3% |
| Mumbai | 5.3% |
| Hyderabad | 5% |
| Bangalore | 3.7% |
| Chennai | 3.3% |
| Jaipur | 2.7% |
| Pune | 2.3% |
| Nagpur | 2.3% |
| Patna | 2% |
already knew a ₹2,000 threshold was being discussed.
Another 32.7% had heard rumours without being sure of the exact figure. Only 1.0% — three respondents — said the whole subject was new to them.
So this is not a story about an uninformed public. It is a story about near-universal awareness of a threshold, attached to the wrong conclusion about who pays. After the debrief, 75.7% said they were very surprised, having heard completely wrong rumours.
Seven in ten expect to pay a fee themselves.
Two questions test the same misconception from different angles. Both find that a merchant-side cost has been widely re-interpreted as a consumer-side one.
Will consumers be charged ₹5 directly?
Belief about transfers above ₹2,000
| Response | Respondents |
|---|---|
| Yes, charged directly | 69.3% |
| No, it is free for consumers | 30% |
| Not sure | 0.7% |
Who do people think actually pays?
Understanding of merchant discount rates
| Response | Respondents |
|---|---|
| The receiving merchant | 49.3% |
| The consumer’s own account | 44.3% |
| The payment app | 5.7% |
| Not sure | 0.7% |
72% of respondents transacting three to four times a week still expect a direct debit — frequency of use provides no protection against the rumour.
75.7% were very surprised when told P2P transfers remain free, against 7.0% who already knew how the policy works.
A ₹5 fee is tolerable — until there is an alternative.
Asked in isolation, most people would still pay. Asked about their breaking point, and asked to rank alternatives, the same people describe walking away. Both results are in the data and they need reading together.
Would you still use UPI with a ₹5 fee?
Scenario: a ₹2,500 retail purchase
| Response | Respondents |
|---|---|
| 5 · Very likely | 36.3% |
| 4 · Likely | 36% |
| 3 · Neutral | 13.7% |
| 2 · Unlikely | 7.7% |
| 1 · Would refuse | 6.3% |
“Convenience outweighs a ₹5 charge”
Agreement on large transactions
| Response | Respondents |
|---|---|
| 4 · Agree | 38.3% |
| 5 · Strongly agree | 36.7% |
| 3 · Neutral | 14% |
| 2 · Disagree | 6.3% |
| 1 · Strongly disagree | 4.7% |
Where convenience stops being worth it
Stated breaking point on a ₹2,500 transaction
| Response | Respondents |
|---|---|
| ₹5 extra | 36% |
| ₹1 to ₹2 extra | 28.3% |
would be intensely frustrated by a surcharge at checkout.
41.0% rated their frustration at the maximum and 36.7% one below it, while only 7.7% shrugged it off. Free payment is treated as a baseline utility, not a feature.
Yet 72.3% of the same sample would still complete the payment, and 75.0% agree convenience outweighs the charge. Frustration and abandonment are not the same behaviour — the report’s own checkout section concludes that retailers face minimal exposure, which is the opposite of what its executive summary argues.
People would not quit. They would game it.
The behavioural response to a perceived threshold is not abandonment. It is splitting the ticket to duck under it — and, where an alternative is easy, reaching for notes.
Would you split a ₹2,500 payment?
Into two sub-threshold transfers, to avoid the fee
| Response | Respondents |
|---|---|
| 5 · Definitely would split | 43.7% |
| 4 · Probably would split | 31.7% |
| 3 to 1 · Lower propensity | 24.6% |
If UPI carried a fee, what instead?
First-choice alternative for high-ticket purchases
| Response | Ranked first |
|---|---|
| Cash | 56.3% |
| Credit card | 28.7% |
| Debit card | 11% |
| Net banking | 4% |
Full alternative-payment ranking
4 options · n=300| Alternative | Borda total | Mean rank | Ranked #1 | Top-3 |
|---|---|---|---|---|
| Cash | 448 | 1.411 | 56.3% | 69.3% |
| Credit card | 325 | 1.869 | 28.7% | 52.0% |
| Debit card | 285 | 2.151 | 11.0% | 45.3% |
| Net banking | 158 | 2.891 | 4.0% | 20.0% |
Lower mean rank means a stronger preference. The substitution runs out of the formal digital system rather than across it: cash outranks all three electronic alternatives combined on first choice. Credit-card substitution rises with age — 38.6% of 36–45s put it first, against 25.4% of 25–35s — while 59.3% of 18–24s choose cash and only 11.1% pick a debit card. Source: pp. 15–16, 23.
One clarification recovers most of it.
Respondents were then told plainly that consumers are not charged. Intent rebounds sharply — but a stubborn third keeps its reservations, and that residue is the actionable part.
Usage intent after the clarification
Likelihood of continuing normal use above ₹2,000
| Response | Respondents |
|---|---|
| 5 · Maximum likelihood | 40.3% |
| 4 · Likely | 37.7% |
| 3 to 1 · Lower intent | 22% |
Did it change the intent to switch or split?
Self-reported change after the clarification
| Response | Respondents |
|---|---|
| Completely restored | 59.3% |
| Partially restored, still have reservations | 37% |
| Unchanged, will switch regardless | 3.7% |
Prior belief × recovery after the clarification
All 7 combinations · n=300| What they believed | After clarification | Respondents |
|---|---|---|
| Yes, consumers are charged directly | Completely restored | 138 |
| Yes, consumers are charged directly | Partially restored | 64 |
| No, it is free / paid by merchants | Partially restored | 45 |
| No, it is free / paid by merchants | Completely restored | 40 |
| Yes, consumers are charged directly | Unchanged, will switch anyway | 6 |
| No, it is free / paid by merchants | Unchanged, will switch anyway | 5 |
| Not sure / had not heard details | Partially restored | 2 |
Counts sum to the full 300-respondent base. Two readings matter. Among the 208 misinformed respondents, 138 — 66.3% — fully abandoned plans to split or switch, and only 6 were immovable. But among the 90 who already knew payments were free, half remain only partially restored: correct information alone does not remove the expectation that a charge appears eventually. Source: pp. 21–22.
What belief does to behaviour.
Cutting the behavioural measures by what people believe, and by how often they transact, shows where the friction actually concentrates — and how little it takes to route around an app.
Behaviour by what respondents believe about the fee
Mean scores, 1–5| Measure | Believe they are charged (n=208) | Know it is free (n=90) | Not sure (n=2) |
|---|---|---|---|
| Likelihood of splitting a payment | 4.144 | 3.956 | 3.500 |
| Frustration at a merchant surcharge | 4.144 | 3.989 | 3.500 |
| Intent to pay by UPI in the ₹2,500 scenario | 3.995 | 3.622 | 4.000 |
| Intent after the clarification | 4.125 | 3.933 | 4.000 |
Means reproduced from the source. The gaps run in a consistent direction but are small — the largest is 0.37 on a five-point scale. The “not sure” column rests on two respondents and carries no weight. Worth noting the third row runs counter to the narrative: the group expecting a charge reports higher intent to pay, not lower. Source: pp. 25–26.
Fee resilience by transaction frequency
Mean likelihood, 1–5| Scenario | At least once a week (n=102) | Multiple times a week (n=178) | 1–3 times a month (n=20) | All respondents |
|---|---|---|---|---|
| ₹2,500 retail purchase with a ₹5 fee | 4.020 | 3.871 | 3.300 | 3.883 |
| ₹3,000 transfer to family with a ₹5 fee | 3.824 | 3.775 | 3.200 | 3.753 |
| ₹700 everyday spend | 4.010 | 3.882 | 3.450 | 3.897 |
Occasional transactors are consistently the least tolerant across all three scenarios, but their base is 20 respondents and the source flags the read as directional. Weekly and multiple-weekly users are within 0.15 of each other on every measure — frequency separates the occasional user from the habitual one, not the heavy user from the moderate one. Source: p. 25.
How many apps people keep installed
Co-usage across the major UPI applications
| Response | Share of respondents using both |
|---|---|
| Paytm + PhonePe | 51.67% |
| Google Pay + PhonePe | 48.33% |
| Google Pay + Paytm | 47.67% |
| BHIM + Paytm | 35.67% |
| BHIM + Google Pay | 34% |
| BHIM + PhonePe | 33.67% |
| Cred + Google Pay | 18% |
| Cred + Paytm | 17.67% |
| BHIM + Cred | 16.67% |
| Cred + PhonePe | 16.33% |
What the data supports doing next.
Four priorities drawn from the report, ordered by how much of the measured friction each one removes.
Put the reassurance in the flow
A single clarification fully restored 138 of 208 misinformed users. Test a persistent “no fee to you” confirmation on transfers above ₹2,000, inside the payment screen rather than in a public notice, and measure whether it moves completion.
Target the partially restored third
37.0% stay only partially reassured — including half of those who were never misinformed. This group, not the hard core of 11 people, is where residual splitting behaviour will come from.
Hold the zero-surcharge line at the counter
77.7% report intense frustration at a checkout surcharge, and cash is the first-choice alternative for 56.3% of the sample. Merchant-side enforcement protects more volume than consumer-side messaging does.
Plan for split-tendering, not churn
75.4% would split a ₹2,500 ticket rather than abandon UPI. The exposure is queue time and settlement reconciliation at the point of sale, so test gateway-level handling of rapid split payments before assuming volume simply disappears.
Recommendations synthesised from report pp. 2–3, 11, 21–22 and 32–33.
