Overview

• ICICI Bank notified payment aggregators this month that it will impose fees on UPI transactions from August 1 to recoup rising infrastructure and processing costs.
• Aggregators with ICICI-hosted escrow accounts will pay 0.02% per transaction (capped at ₹6) while those without will incur 0.04% (capped at ₹10).
• The charges apply solely to payment aggregators and will not affect merchants holding direct accounts with ICICI Bank.
• Industry players are reassessing their escrow partnerships and monitoring whether other major lenders will adopt similar fees.
• The decision intensifies debates over the long-term financial sustainability of India's zero-fee UPI framework.