Zero UPI interchange, PSP fees may hurt PhonePe, Google Pay
Through a circular on Friday, the National Payments Corporation of India (NPCI) said that it has agreed to revise the UPI interchange and payment service provider fees to "zero" for all domestic UPI merchant (P2M) transactions with retrospective effect from January 1, 2020.
 
The abolition of the fees has been made for an interim period until April 30, 2020, according to the circular.
 
The same is not applicable to services like mandates, EMI, overdraft account and business-to-business (B2B) collections and payments. 
 
The move to do away with these transactions fees comes after the abolishment of the Merchant Discount Rate (MDR). 
 
With banks not able to charge merchants any MDR for RuPay debit card and UPI transactions, it was expected that they would be given the breather of not paying a fee to other stakeholders.
 
However, the move may hit revenues of digital payments players like PhonePe, Google Pay and Amazon Pay which have spent heavily to grab a greater market share in the UPI ecosystem.
 
As the abolishment of the UPI interchange and PSP fees for all domestic UPI merchant transactions comes with retrospective effect from January 1, it is not yet known how the fee already collected so far will be recovered.
 
The waiver of the PSP fee would hardly leave any room for Third Party Apps (TPAs) such as Google Pay, PhonePe, Amazon Pay and others to earn anything on UPI transactions. 
 
On every UPI P2M transactions, these TPAs on average make about Rs. 0.30 - 0.35 through PSP fee.
 
It remains to be seen what future revenue generation streams can help these digital payments players stay afloat.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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    Saffronart to auction fugitive Nirav Modi's art collection
    Last month, Saffronart became the first professional auction house to be appointed by the Enforcement Directorate, Mumbai to auction seized assets. Two sales - 'Spring Live Auction' in Mumbai on February 27 and 'Spring Online Auction' on March 3 and 4 will feature a total of 112 lots seized from fugitive businessman Nirav Modi, including significant artworks by leading modern and contemporary Indian artists, and a selection of luxury watches, handbags and cars.
     
    The Spring Live Auction will feature 40 lots, of which 15 are artworks. Leading the sale is a 1935 masterpiece by one of the most important Indian artists of the 20th century, Amrita Sher-Gil, titled Boys with Lemons, estimated at Rs 12-18 crore.
     
    The painting, which will appear on the auction market for the first time, was probably painted while Sher-Gil was back at her family home in Simla and represents a time when she was trying to carve out her own identity by exploring subjects deeply rooted in the Indian sentiment.
     
    Another highlight of the live sale is an oil on canvas work from 1972 titled Battle of Ganga and Jamuna: Mahabharata 12 by M.F. Husain, estimated at Rs 12-18 crore. In this work, Husain contemporarises the epic Mahabharata, focusing on the psychological component and the metaphor of internal moral struggles that it represents through the battle between the two rivers.
     
    A serene blue painting by V.S. Gaitonde from 1972, which will also be auctioned is estimated at Rs 7-9 crore; a vivid red depiction of Krishna by Manjit Bawa estimated at Rs 3-5 crore, and a stunning portrait by Raja Ravi Varma at at Rs 2-3 crore.
     
    Among the 25 luxury collectibles are several important timepieces, including a rare Jaeger-LeCoultre Men's 'Reverso Gyrotourbillon 2' Limited Edition Wristwatch, estimated at Rs 55-70 lakh, and a Patek Phillipe Nautilus Gold and Diamond Wristwatch, also estimated at Rs 55-70 lakh.
     
    The live sale will feature several branded handbags, including the iconic Birkin and Kelly lines by French luxury goods manufacturer Hermes.
     
    Rolls-Royce Ghost, estimated at Rs 75-95 lakh will also be auctioned on February 27.
     
    The Spring Online Auction, which will be held on saffronart.com, will comprise a selection of 72 luxury collectibles, with highlights including handbags by brands such as Chanel, Hermes, Louis Vuitton, and Celine; a Cartier Asymmetric 'Crash' Wristwatch and a Porsche Panamera S car.
     
    This appointment by the Enforcement Directorate comes a year after an auction of seized paintings conducted by Saffronart on behalf of the Income Tax Department in March 2019 - which raised Rs 54.84 crore.
     
    Select lots from both auctions will be exhibited at Saffronart's gallery in Mumbai from February 18 to March 4.
     
    Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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    Banks Face Deterioration in Corporate Debt Repayment Capacity: Moody's
    India's banking sector has been marked as one of the most exposed to deterioration in corporate debt repayment capacity, Moody's Investor Service said on Wednesday.
     
    In a sector specific report on credit conditions in Asia, the firm said: "In the banking sector, deterioration in growth dynamics and macroeconomic conditions will inevitably weigh on banks' asset quality through a combination of deteriorating debt repayment capabilities and rising default risks among weaker Asian companies."
     
    "Our stress tests on corporate income shock impact show that India and Indonesia are the countries most exposed to deterioration in corporate debt repayment capacity, followed by Singapore, Malaysia and China."
     
    The report further said that the regional political flashpoints such as the conflict between India and Pakistan has resulted in the rise of policy uncertainty indices of the affected economies to multiyear highs in recent months
     
    In terms of the longer-term demographic challenges, the report said that India, Indonesia and the Philippines, "where the population is much younger, face an equally tough challenge of creating sufficient employment opportunities and adequately preparing its young workforce".
     
    "In India, youth unemployment has been rising alongside falling labour force participation, an indicator of mismatched skills and expectations and low availability of jobs."
     
    According to a 2017 OECD survey, more than 30 per cent of youth ages 15-29 in India are also not employed, in school or enrolled in training, which leaves the country with a significant share of low-skilled workers.
     
    The report added that India suffers from institutional bottlenecks and fiscal challenges, although the country has benefited from a relatively low external debt burden.
     
    Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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