July 29, 2025 — Reserve Bank of India (RBI) Governor Shaktikanta Das on Monday raised concerns about the long-term sustainability of the Unified Payments Interface (UPI), emphasizing the need for a cost-sharing mechanism either by users or industry stakeholders to maintain the digital payment system.
Speaking at a fintech summit in Mumbai, Das stated that while UPI has emerged as a powerful tool for digital inclusion and economic empowerment, its current zero-cost framework is not financially viable in the long term. “For UPI to remain sustainable, the cost of operating the system has to be borne either by users or by the ecosystem participants,” he said.
UPI, developed by the National Payments Corporation of India (NPCI), has transformed India’s digital payments landscape since its launch in 2016. The platform processed over 14 billion transactions worth more than ₹20 lakh crore in June 2025 alone. Despite its rapid growth and widespread adoption, the infrastructure and operational costs associated with running UPI continue to be absorbed by banks and payment service providers (PSPs), with no direct revenue generation.
At present, UPI transactions are free for users, and service providers receive government subsidies to cover a portion of their expenses. However, with increasing volumes and mounting costs, several stakeholders have questioned the sustainability of the subsidy-based model.
Industry leaders have echoed the RBI Governor’s views, calling for a more viable financial structure. “We need a balanced approach where low-value or essential transactions remain free, but commercial and high-volume usage is monetized in a fair and transparent manner,” a senior executive at a private bank said.
The government has previously maintained that UPI should remain a free digital public good. In August 2022, the Ministry of Finance clarified that no fees would be levied on UPI transactions. Nevertheless, the RBI has consistently pushed for exploration of alternative revenue models to reduce dependence on government funding.
Experts suggest that a tiered or usage-based pricing model could be one way forward, ensuring both inclusion and economic sustainability. Such a model would allow users to continue benefiting from free services for basic needs while encouraging businesses and frequent users to contribute to the infrastructure costs.
The central bank is also said to be working on broader digital public infrastructure (DPI) guidelines to define the responsibilities of ecosystem players and promote innovation within a sustainable framework.
Das’s remarks come at a time when India’s digital economy is witnessing unprecedented growth, with UPI at the forefront of the transformation. The RBI’s emphasis on sustainability is expected to trigger renewed discussions between banks, fintechs, the government, and the public on how best to preserve and grow the platform.
