76% of people would abandon UPI payments if shopkeepers demanded extra charges – Survey

A LocalCircles survey found that while 14% of UPI users would continue using the service even if charged extra, the majority indicated they would switch to cash, cards, or bank transfers.

A large number of people might change their payment methods in the near future if shopkeepers demand extra charges for UPI transactions. A new survey asked UPI users what they would do if a shopkeeper asked for an additional fee on UPI payments exceeding ₹2,000.

Only 14% of the UPI users surveyed by LocalCircles stated they would continue using UPI despite the extra charge. The rest indicated they would switch to other options such as cash, credit cards, debit cards, or bank transfers. This survey comes at a time when a 0.4% Merchant Discount Rate (MDR) is set to apply to certain UPI merchant payments exceeding ₹2,000, starting October 15.

What would you do if a shopkeeper asked for extra money?

LocalCircles surveyed UPI users across 291 districts regarding this issue. While the survey garnered over 67,000 responses in total, 31,206 people specifically answered the question regarding extra charges. The survey revealed that 76% of respondents would consider switching to other payment methods if a shopkeeper demanded an additional amount for UPI transactions.

• 27% said they would pay using cash.
• 26% said they would use a credit card.
• 14% said they would pay using a debit card.
• 4% said they would opt for bank transfers, NEFT, or IMPS.
• 9% said they would ask for an alternative payment method that does not incur extra charges.
• Only 14% of people were willing to continue using UPI despite the extra cost.
• 2% of people indicated they would postpone or cancel their purchases.
• 4% of people did not provide a response.

People might move away from UPI for large payments

The survey also inquired about long-term payment habits. Respondents were asked which payment method they would primarily use in the future if UPI transactions exceeding ₹2,000 incurred additional charges. Out of 37,654 responses, 26% opted for credit cards, while an equal percentage chose cash.

Meanwhile, 13% preferred debit cards, and 11% opted for bank transfers, NEFT, or IMPS. Only 20% stated that UPI would remain their primary method for large payments even with the additional charges.