Google Pay Now Charges Convenience Fee on Bill Payments Via Credit and Debit Cards All Details

Google Pay, one of the big platforms of digital payment in India, has now started levying convenience fees on bill payment made with credit and debit cards. This change will put a little more weight on the pockets of millions of users who used to pay the necessary service bills like electricity and gas without any extra fees. According to the Google Pay website, this fee can range from 0.5% to 1%, which will be fixed on the basis of transaction value. Apart from this, GST will also apply to it. However, the payment made from the UPI Linked Bank Account will not be charged any kind of extra charge. In recent times, many other fintech companies have taken such steps to generate revenue from UPI transactions.

According to the information given on the Google Pay website, this new fee can range from 0.5% to 1% according to the transaction value. The economic time UnderIn January 2025, Google Pay processed UPI transaction of Rs 8.26 trillion, making it the second largest digital payment platform after PhonePe. Earlier, Google Pay imposed a convenience of Rs 3 on mobile recharge.

This change is not limited to Google Pay only. PhonePe also charges fees on credit and debit card bill payment. At the same time, a fee of Rs 1 to Rs 40 is charged for UPI recharge and bill payment on Paytm platform. This industry wide trend is considered to be a step taken to make the business model of digital payment companies sustainable.

According to the report, the processing cost of UPI transactions in FY24 was around Rs 12,000 crore, out of which Rs 4,000 crore was spent on transactions with a value of less than Rs 2,000. Since 2020, the government had abolished MDR (Merchant Discount Rate) on UPI payment of less than Rs 2,000, so that small transactions could be promoted. However, transactions of more than Rs 2,000 can be charged up to 1.1%.

Given the tendency to monnetize the growing UPI transactions in the fintech industry, other platforms can also apply such fees in the coming time. At the moment, Google Pay users will have to take care of this new charge while paying bills with credit and debit cards.