PhonePe will now charge a fee for mobile recharges. Here’s how much you will pay

PhonePe is calling this mobile transaction fee a "small-scale experiment".

Highlights
  • PhonePe will charge a transaction fee on mobile recharges above Rs 50.
  • Users will be charged a fee between Re 1 to Rs 2 on mobile recharges, including transactions done through UPI.
  • No transaction fee would be charged on other UPI transactions.

Walmart-owned PhonePe has announced will charge a transaction fee for mobile recharges. PhonePe will be one of India’s first digital payment services in India to charge a transaction fee for mobile recharge. The company says that it would charge a transaction fee between Re 1 to Rs 2 for mobile recharges priced above Rs 50. PhonePe will be charging the fee even on the transactions done through UPI (Unified Payments Interface). The company is calling this fee a small-scale experiment, and is facing criticism on the move.

While commenting on the transaction fee, a PhonePe spokesperson said told news agency PTI, “On recharges, we are running a very small-scale experiment where a few users are paying for mobile recharges. Recharges below ₹50 are not charged, recharges between Rs 50 and Rs 100 are charged Re 1, and above Rs 100 are charged Rs 2. Essentially, as a part of the experiment, a majority of users are either not paying anything or paying Re 1.”

Recharge priceTransaction charge
Up to Rs 50No fee
Rs 50-100Re 1
Rs 101+Rs 2

Like other digital payments apps, PhonePe also charges a transaction fee on payments done through credit cards. However, PhonePe will be the first payment app in India to charge a transaction fee on UPI payments. The company confirmed that the other payments made using UPI would remain free, and no transaction fee would be charged for those transactions. So, users won’t have to pay charges for sending money to friends or merchants using UPI. Also, users won’t be asked for any transaction fees for mobile recharges of less than Rs 50.

On the criticism for the transaction fee, PhonePe said, “We are not the only player or payment platform charging a fee. Charging a small fee on bill payments is now a standard industry practice and is done by other biller websites and payment platforms also. We charge a processing fee (called as convenience fee on other platforms) on payments with credit cards only,” while also clarifying the transaction fee on mobile recharges above Rs 50.

PhonePe stands at the top in UPI transactions done in the country, with over 165 crore payments recorded in September this year alone. These transactions total Rs 3,06 lakh crore. The company holds more than 40 percent of the share in the UPI transactions made in India.