New Delhi: The days of entirely free digital payments may be numbered, with the Reserve Bank of India (RBI) hinting at a shift in the current zero-charge framework for UPI transactions.

RBI Governor Sanjay Malhotra has called for a more financially sustainable model as digital payments continue to expand rapidly across the country.

Speaking at a Financial Express event, Malhotra said, “Payments and money are a lifeline. We need a universally efficient system. As of now, there are no charges. The government is subsidising various players such as banks and other stakeholders in the UPI payments system. Some costs have to be paid.”

Malhotra noted that while India remains committed to secure and inclusive digital payments, the long-term viability of the system cannot be ignored.

“Any important infrastructure must bear fruit...its cost should be paid whether collectively or by the user,” he added.

Currently, UPI runs without any charges for users, with the government footing the bill to keep the system free.

Malhotra clarified that the final decision on continuing the zero MDR (merchant discount rate) policy rests with the government, suggesting that a policy rethink may be on the horizon.

Malhotra also highlighted that the Reserve Bank of India's monetary policies are forward-looking and the Monetary Policy Committee of India (MPC) will focus more on outlook than current data.

MPC is set to hold a meeting on August 4-6, and monetary policy will be announced on August 6, 2025.

"Monetary policy being data-driven, more on the outlook will be guided by the revised numbers if any call is taken."

He further added that, "I may mention over here that the stance of neutral allows them to give them the flexibility to move in either direction or even to have a pause, and the MPC will be looking at the data that comes in."

During the event, the governor also commented on the RBI's effort to maintain price stability. Malhotra said, "Price stability continues to be a challenge number one, and I would say banking regulation, because that's our other area we're a full-service central bank, as they say, so apart from monetary policy, we do so many other things, including banking regulation." (With inputs from ANI)