Google Pay to collect convenience fee on mobile recharge transactions

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Fintech major Google Pay has recently started charging customers a convenience fee on mobile recharges. The move by the firm comes after years that the app has allowed users to recharge their prepaid plan and pay bills at no additional cost.

The payments platform is charging users anywhere between ₹1 and ₹3 depending on the recharge value. The fee is charged on recharges of ₹100 or more that are made via the app’s unified payments interface (UPI) service.

This recent move aligns Google Pay with other payment platforms like Paytm and PhonePe, which already impose charges for similar transactions. Despite this change, Google has not officially announced the addition of convenience fees on its payment app.

This change in Google Pay’s policy follows a trend set by other payment service providers, such as Paytm and PhonePe, aiming to monetise their platforms by introducing fees for transactions. Similar charges have been implemented by various online services for tasks like ordering food or booking movie tickets.

UPI market share

Per latest NPCI data, PhonePe accounted for 46 per cent of UPI transaction volumes in October 2023, Google Pay for 36 per cent, and Paytm another 13 per cent. In comparison, as of October 2022, PhonePe had a market share of 47 per cent, Google Pay of 34 per cent and Paytm of around 15 per cent.

Also read: Top three apps continue to dominate UPI trade, despite plans to curb their share

Collectively, PhonePe, Google Pay, and Paytm accounted for 94 per cent of UPI transactions by volume and 96 per cent by value in March 2023, per the Centre for Advanced Financial Research and Learning (CAFRAL)’s India Finance Report for FY23.

In terms of value of transactions, PhonePe had a market share of 48 per cent, Google Pay of 34 per cent and Paytm of 11 per cent as of October 2023.