India is revising its digital payments rules to let the government decide which electronic payment methods are protected from charges.
The Taxation and Other Laws (Amendment) Bill, 2026 would change how those protections are set.
Banks and payment providers would remain barred from directly or indirectly charging people who make or receive payments through digital payment methods covered by the government.
The current system links that protection to payment methods prescribed under the Income-tax Act, which has supported the zero-charge treatment of BHIM-UPI and RuPay debit card transactions.
Under the bill, the central government would instead specify which payment methods are covered through separate notifications.
The change does not itself introduce a fee or set a merchant discount rate.
Instead, it changes how the government decides which digital payment methods remain protected from charges.
The regulatory shift comes as the National Payments Corporation of India (NPCI) looks to take UPI into more overseas markets.
NPCI Looks to Expand UPI Overseas
NPCI is in talks with Japan, Malaysia and Bahrain, Bloomberg reported, citing CEO Dilip Asbe.
Asbe outlined the possibility of UPI reaching 15 to 20 markets over the next decade, with NPCI initially focusing on countries with large Indian communities.
The strategy is aimed at increasing the use of UPI for remittances and other cross-border payments.
UPI already has a presence in nine countries, including Singapore, France and the United Arab Emirates, according to Bloomberg.
The report added that UPI supports person-to-person remittances with Singapore and Nepal, while inward remittances are enabled from Greece.
Asbe also pointed to greater self-sufficiency in cross-border payments as a longer-term goal, building on UPI’s role in India’s domestic payments market.
Featured image: Edited by Fintech News Singapore, based on image by RSplaneta via Magnific
