<h1 class="ql-align-center"><strong style="color: rgb(230, 0, 0);">Interchange Fee&nbsp;</strong></h1><p class="ql-align-center"><br></p><h3><strong>Context&nbsp;</strong></h3><ul><li class="ql-indent-1">The NPCI has introduced <strong>interchange fees of up to 1.1% on merchant UPI </strong>transactions done using <strong>prepaid payment instruments (PPI) from April 1, 2023.</strong></li></ul><h3><strong>More about the news&nbsp;</strong></h3><ul><li class="ql-indent-1">The interchange charges introduced are only applicable for the PPI merchant transactions. And there is no charge to customers.</li><li class="ql-indent-1">There are no charges for bank account to bank account based UPI payment (normal UPI payments).</li><li class="ql-indent-1">Peer-to-peer (P2P) and peer-to-peer-merchant (P2PM) transactions also remain unaffected.</li><li class="ql-indent-1">The interchange rates vary according to merchant category codes, in the range of 0.5% to 1.1%.</li><li class="ql-indent-1">Interchange fee - It is a fee charged by the receiver bank/payment service provider to the merchant.</li><li class="ql-indent-1">Receiver of interchange fee - The PPI owner will receive the applicable interchange fee from the merchant.</li></ul><h3><strong>NPCI</strong></h3><ul><li class="ql-indent-1">It is an umbrella organization for operating retail payments and settlement systems in India.</li><li class="ql-indent-1">It&nbsp;is an initiative of <strong>the Reserve Bank of India (RBI) and Indian Banks’ Association (IBA).&nbsp;</strong></li><li class="ql-indent-1">It was created under <strong>the provisions of the Payment and Settlement Systems Act, 2007,</strong> for creating a robust Payment &amp; Settlement Infrastructure in India.</li><li class="ql-indent-1">For this, NPCI was incorporated as a “Not for Profit” Company under the provisions of Section 25 of Companies Act 1956 (now Section 8 of Companies Act 2013).</li></ul><h3>Products by NPCI</h3><ul><li class="ql-indent-1"><strong>RuPay card </strong>- an Indigenously developed Payment System which supports the issuance of debit, credit and prepaid cards by banks in India</li><li class="ql-indent-1"><strong>IMPS -</strong> With Immediate Payment Service (IMPS), India has become the leading country in the world in real time payments in the retail sector.</li><li class="ql-indent-1"><strong>NACH -</strong> National Automated Clearing House (NACH) provides an electronic mandate platform to register mandates facilitating paperless collection processes for the corporates and banks.</li><li class="ql-indent-1"><strong>*99# -</strong> USSD based mobile banking platform that makes banking services accessible to all the bank account holders on their mobile phones.&nbsp;</li><li class="ql-indent-1"><strong>Aadhaar Enabled Payment System (AePS) -</strong> AePS is a bank-led model that allows online interoperable financial inclusion transactions at PoS of any bank using the Aadhaar authentication through the retail merchant.</li><li class="ql-indent-1"><strong>UPI – Unified Payment System (UPI)</strong> has been termed as the revolutionary product in the payment system.</li><li class="ql-indent-1"><strong>Bharat Bill Payment System </strong>– It offers one-stop bill payment solution for all recurring payments with 200+ Billers in the categories Viz. Electricity, Gas, Water, etc.</li><li class="ql-indent-1"><strong>NETC - National Electronic Toll Collection (NETC) program</strong> meets the electronic tolling requirements of the Indian market.</li></ul><p class="ql-align-center"><br></p><h1 class="ql-align-center"><strong>PRELIMS NOTES:</strong><a href="https://www.sunyaias.com/subscription-details/prelims-2023-sunya-notes-current-affairs" rel="noopener noreferrer" target="_blank" style="color: rgb(0, 102, 204);"><strong>CLICK HERE</strong></a></h1>