In short, PSP fees help beneficiary banks and payment service providers earn money on each UPI transaction.
Currently, they earn around INR 0.25, INR 1, and INR 5 on transactions worth up to INR 1000, INR 25K, and up to INR 75K respectively.
Based on these fees, UPI payments apps such as PhonePe, Paytm, Google Pay, Amazon Pay and others earn around INR 0.30-0.35 on every transaction.
However, after abolishing PSP, these platforms would not be able to earn any money from P2M UPI transactions.
It is important to note that companies such as Paytm, Google, Amazon, PhonePe and others have invested millions of dollars in the market to acquire users and in habit-forming for the digital payments ecosystem. | To read full story, visit https://startuparound.com/read/1582268406.5949023/More-Trouble-For-Paytm,-PhonePe-As-NPCI-Abolishes-UPI-PSP-Fees?ref=audio_experience