If you are someone who makes payments by linking your credit card to UPI when making purchases, you should be aware of this extremely crucial development. This is important, given that a considerable number of users are still unsure whether this method of making payments will incur any additional charges. According to the National Payments Corporation of India, if a customer makes a UPI payment of up to Rs 2,000 using a RuPay credit card, no charge is applicable.
No charges for payment up to Rs 2,000
To simplify it further, if you purchase goods worth up to Rs 2000 from any shop and make the payment through UPI, there will be no charge. However, it is worth noting that this applies only to the use of the RuPay credit card.
What if the payment exceeds Rs 2,000
However, if the payment exceeds the threshold of Rs 2,000, customers can be subject to the Merchant Discount Rate (MDR). It is to be noted that this charge is levied on the shopkeeper only, but in many cases, the shopkeeper collects it from the customer.
Currently, the MDR (Merchant Discount Rate) charge applies to large merchants and branded stores. Small shopkeepers, local vendors, and grocery stores are exempt from this requirement. This implies that small purchases by ordinary people are less likely to be affected.
Any user with a RuPay credit card can link it to a UPI app (such as PhonePe, Google Pay, or Paytm). Following this, he/she can make payments directly from the credit card by scanning the QR code. This simply acts like a debit card.
Smart Tips for Using Credit Cards
- Pay your total bill every month to avoid interest and penalties.
- Maintain timely payments and use your credit limit wisely to boost your credit score.
- Set up auto-debit to never miss a due date.
- Opt for EMIs only after reviewing the applicable interest rates and fees.
- If you own multiple cards, monitor their limits, due dates, and available offers carefully.
