It’s actually a big question about who pays for India’s digital payments revolution. In 2016, demonetization pushed millions toward UPI. Today, UPI processes nearly 800 million transactions daily; a world-beating success. But starting October 15, 2026, a 0.4% fee (capped at ₹300) will apply to merchant transactions above ₹2,000. The government says it’s not a tax; it’s a fee to fund infrastructure, cybersecurity, and innovation. Fair, right? But here’s the catch: Who actually bears the cost? Merchants can’t pass it directly to consumers. So they’ll absorb it; or adjust pricing over time. Either way, the burden trickles down. And here’s the real story: While UPI is public infrastructure (run by NPCI), most users access it through private apps; PhonePe and Google Pay. These apps, backed by Walmart and Alphabet, now stand to earn a cut from this new revenue stream. Entrepreneur Ashneer Grover isn’t buying it. He calls it a hidden tax, pointing out that banks made ₹4.11 lakh crore in profits and NPCI itself posted ₹1,888 crore in surplus. If the system’s already profitable, why now? And if cash costs ₹30,500 crore annually to maintain, shouldn’t digital be cheaper? The question isn’t whether UPI needs funding; it does. It’s whether the funding model rewards the right players and doesn’t quietly shift costs onto small businesses and consumers. Because the most successful revolutions aren’t just about tech; they’re about fairness in who pays, who profits, and who gets left behind.