Google Pay charges convenience fees on bill payments now
The fee charged ranges from 0.5% to 1% of transaction amount plus GST charges; it reflects a larger industry shift towards monetising UPI transactions
Users who use Google Pay to pay their bills like gas and electricity must now be aware that they will have to fork out a convenience fee, which will be charged on bill payments using debit or credit cards.
This shift is also effectively ending the era of fee-free transactions for millions of users paying for essential services like power and gas, said news reports.
On its part, the fintech sector is looking for sustainable ways to recover payment processing costs.
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According to reports, a source told The Economic Times that the introduction of platform fees by Google Pay reflects a larger industry shift towards monetising UPI transactions. As digital payment adoption increases, fintech firms are exploring ways to make their business models financially sustainable.
Fee amount charged?
This fee charged on bill payments ranges from 0.5 per cent to 1 per cent of the transaction amount, plus the GST costs. According to reports, users are having to pay ₹15 as a ‘convenience fee’ when paying for an electrical bill with a credit card.
Payments made via Google Pay through UPI that are made directly from a bank account are exempt from this convenience fee.
Also read: NPCI extends deadline for GPay, PhonePe to cut UPI market share by 2 years
Shifting costs onto consumers
Google Pay is following in the footsteps of PhonePe and PayTM that also charge similar fees for bill payments, mobile recharges and other services.
This convenience fee charge on bill payments for users with credit or debit cards follows Google Pay’s previous charges of ₹3 on mobile recharges as a convenience fee enacted over a year ago.
Google Pay currently holds a significant share of the UPI market, accounting for nearly 37 per cent of transactions, second only to PhonePe, which is backed by Walmart. The platform processed transactions worth ₹8.26 trillion last month.
Changing trends in fintech firms
According to a PwC analysis, fintech firms collectively incurred costs of up to ₹12,000 crore for processing UPI transactions in FY24. This has prompted several of them to look forward and explore new revenue generation models.
According to reports, the convenience fee is subject to changes over time. The convenience fee will be charged per bill payment, regardless of the recipient’s number being used or the specific bill being paid with a debit, credit or a RuPay card.
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The usage of UPI continues to grow in India with 16.99 billion transactions being recorded in January 2025 worth ₹23.48 lakh crore, reflecting a 39 per cent year-on-year growth.