One of the reasons why the fee is being considered is under the pressure of other payment providers who are loosing to UPI in Indian market. Its been believed to be one of the negotiation points by the US-India trade deals

>India is forced to subsidize farmers to the tune of $37B JUST for urea. Governments routinely offer free bus services to women, free cash handouts to women, free electricity to farmers (who then use the power to pump out groundwater and grow paddy in areas otherwise not suitable for it). The list goes on.

>A $1B subsidy to eliminate friction on the payment front is peanuts.

These are entirely independent issues.

Should India subsidize farmers like this? IDK, maybe

Should India charge fees on UPI payments? IDK, maybe

I don't think adding a 0.5% surcharge to transactions over Rupees 2000 is "pound foolish". Most transactions are smaller, and someone has to pay to maintain the infrastructure. :shrug:

Also: just because money is being wasted on cause $X does not mean that there's more of it lying around to be wasted on cause $Y! You've got to draw the line somewhere!

Agree. Antiquated Indian farm subsidies are the biggest impediment to sustained growth. Nothing can be done, because it'd be electoral suicide to touch them. India's holding more than 100 million tons (!) of grain due to the mandatory procurement policy. It is not merely wastage, but also an environmental disaster to keep doing this.

$1B or even $5B is nothing, given the impact UPI has had across the country.

India (central govt.) also doesn't tax farmers even when they've made bumper profits from their produce. The moment a political party even mentions of taxing rich farmers, their politics is over.

Basically country is going to shits purely due to votebank politics, and this is true across party lines no matter who is in power.

Where do you see $1B subsidy? There is no subsidy. The system is already profitable. This will generate a new revenue stream of $1B for banks out of thin air that has no reason to exist.

Don't forget no income tax on "agricultural income" even if that income is millions.

How is it financially sustainable?

Indian farmer subsidization is retarded. india needs to make farming as unattractive a profession as possible. Every social ill in the subcontinent is ultimately due to the fact that the majority of the population is in farming.

Why to women?

It's a bargain and exactly what governments are for. It's 70¢ per Indian. It's a payment highway and commerce is good.

edit: replied to comment was rephrased during reply.

[dead]

Completely agree - not every public service has to be treated like a commercial business. Treat the payment backbone as a public infrastructure. We pushed banks to open branches in rural areas in India even if it was not "profitable" for them. Today, even Post Offices offer bank accounts in India. And while the BBC article pushes the propaganda that this will be a charge levied on big businesses, we know the reality is that it will be passed on to us consumers and our burden to bear.

And note that this is not being done to serve India's public interest, but under pressure from Trump - The hidden Trump factor in India’s proposed new UPI transaction levy - https://indianexpress.com/article/explained/explained-econom... . India's Prime Minister Modi is happy to do it though, because like his US counterpart, he too subscribes to the anarcho-right political ideology of transferring wealth from the poor and the middle-class to the rich. Just like Trump's tariff "refunds" increased prices and leeched of billions from American citizens to the corporates, charges on UPI transactions can potentially do the same in India.