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PhonePe experimented with levying processing fee on prepaid mobile recharges above Rs. 50

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PhonePe users have taken to social media to express their disappointment over the processing fee on mobile recharges above Rs. 50. The company has confirmed that recharges of less than Rs. 50 is not charged, recharge between Rs. 50-100 rupees are charged. 1, and above Rs 100 is charged. 2. PhonePe says this is a ‘very small scale experiment’ and is not affecting all users. Affected users are criticizing the move as other portals do not charge additional processing fee on mobile recharge.

In an official statement, PhonePe says, “We are experimenting on a very small scale, where some users are paying a small processing fee for mobile recharge. Recharge below Rs.50 is not charged, recharge between Rs. 50-100 rupees are charged. 1 and above Rs. 100 is charged. 2. Given the diverse nature of processing fee, a large section of users are either paying nothing or paying Rs. 1.” The phone clarifies that the processing fee is being charged only on mobile prepaid recharge and is inclusive of all payment modes – credit cards, debit cards and UPI.

As mentioned, PhonePe does not charge any charges on recharges of less than Rs. 50. While PhonePe has offered this as an experiment, other platforms like Freecharge or Paytm do not charge any processing fee on mobile recharge. PhonePe says this is an experiment and not a commercial rollout. It can roll it back based on the feedback. Currently, additional processing fees are visible to many users, including multiple accounts that we have personally verified.

Most digital payment apps charge transaction fees on payments made through credit cards, including PhonePe. However, it has become the first country to charge all devices on mobile recharge. The company has clarified that other payments made using UPI will remain free and no charges will be charged.

Data released by the National Payments Corporation of India (NPCI) in July this year shows that PhonePe dominates the UPI app ecosystem in India with a market share of 46.04 per cent. PhonePe did a transaction of Rs 1,292.71 million. 2,62,565.88 crore in June which was 142.87 million more than the 1,149.84 million done in May. In September, this increased to Rs 1,653.19 million in transactions. 3,06,437.37 crores.

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