UPI Fee Will Burden Traders, Consumers, Says Traders' Body

Thiruvananthapuram: The move to impose additional charges on UPI transactions after bringing people almost entirely into digital payments is aimed at benefiting corporate monopolies, said V Gopinathan, state treasurer of the Kerala Vyapari Vyavasayi Ekopana Samithi.

The Centre is proceeding with the decision to levy a UPI fee despite concerns that it would initially burden small traders and eventually become an additional expense for the general public.

When the issue was raised in Parliament a month ago, the Opposition had strongly protested, pointing out that the move would affect not only traders but the public at large. The Union Finance Minister, however, had maintained that the proposed fee would not be passed on to consumers. Amid mounting protests, the minister had misled the public by stating that the provision was temporary and was not intended to be implemented immediately. A month later, the Centre is now moving towards implementing it.

The proposed additional charge comes at a time when the small-trading sector is already facing a severe crisis and downturn. A product typically changes hands two or three times before reaching the consumer — from the supplier to wholesalers and retailers and finally to the customer. If UPI is used for payments at each stage, traders could have to bear an additional charge on every transaction.

Such a financial burden would be difficult for small traders to absorb. Traders have indicated that if the additional charges become a liability, they may return to cash transactions instead of using digital payment methods.

Traders cannot directly recover the additional fee from consumers as attempts to do so could adversely affect their businesses. The Centre was imposing such measures to benefit corporate monopolies and the additional cost could eventually be passed on entirely to consumers.

Gopinathan also criticised the state government for its alleged silence on an issue that directly affects the trading community. He said there had been no response from the Chief Minister, who also handles the Finance portfolio, despite the seriousness of the issue.

He said the government's failure to respond when traders were facing the prospect of another major burden was condemnable. The state committee would meet soon to formulate protest programmes against the proposed additional charges on UPI transactions, Gopinathan said.