Banks Told To Stock ATMs Ahead Of UPI Charges, PIB Calls Viral Claim Fake

New Delhi: A circulating newspaper clipping claimed banks had been told to load extra cash into ATMs before new UPI merchant charges take effect. PIB Fact Check has rejected the claim, saying neither the Reserve Bank of India (RBI) nor the Finance Ministry issued such an instruction.

What did the clipping claim?

The clipping carried the headline “Banks asked to stock up ATMs ahead of UPI fees”. It suggested that banks were preparing for a rise in cash withdrawals as charges were introduced on some digital payments.

PIB Fact Check marked the claim as fake. Its clarification addressed the alleged instruction to banks; it did not announce any change to ATM cash arrangements.

Which UPI payments remain free?

The revised framework keeps person-to-person UPI transfers free, whatever the amount. Merchant payments of up to Rs 2,000 also attract no merchant discount rate (MDR). Some payments to small merchants above that threshold remain within the zero-MDR framework.

According to the government, about 96 percent of merchant transactions will be unaffected. A 0.4 percent MDR applies to specified merchant payments above Rs 2,000, subject to a cap of Rs 300 per transaction.

Who pays the MDR?

MDR is a fee within the payments system, rather than a government tax or a charge imposed on customers for using UPI. It is shared among participants such as banks and payment service providers. Banks have been advised to ensure merchants do not pass it on to customers.

The distinction matters because the viral headline connected a merchant fee with an expected rush for cash. PIB said the RBI and Finance Ministry had given banks no direction to increase ATM cash stocks.

People encountering similar claims can check announcements from the government and RBI before sharing them. PIB Fact Check also accepts reports of suspicious claims concerning the Central Government.