Google Pay, a leading digital payments platform under Alphabet Inc., has introduced a convenience fee on utility payments made via credit and debit cards in India. The fee, ranging from 0.5% to 1% of the transaction value, includes GST and applies to payments for services like electricity, water, and gas. This move follows similar actions by PhonePe and Paytm, raising concerns about rising digital payment costs.
Google Pay, one of India’s most widely used digital payment platforms, has started charging a convenience fee on utility bill payments made through credit and debit cards. The charges, which range from 0.5% to 1% of the transaction value, include GST and apply to services like electricity, gas, and water bill payments.
Google Pay, owned by Alphabet Inc., has followed the monetization trend adopted by other fintech companies such as PhonePe and Paytm. Previously, users could pay utility bills via credit or debit cards at no additional cost. Now, those using these payment methods will see an additional fee added to their bill amount. However, UPI transactions linked directly to bank accounts remain free of charge.
How Much Will Users Pay?
Reports suggest that users paying utility bills via credit cards have been charged convenience fees of approximately ₹15 per transaction. The fee is listed as a “processing fee for debit and credit card transactions” and includes GST.
Other payment platforms such as PhonePe and Paytm also impose similar fees on credit and debit card transactions. Paytm charges between ₹1 and ₹40 depending on the bill amount for payments such as credit card settlements and gas and water bills. These changes indicate a broader trend in India’s fintech sector, where platforms are moving towards transaction-based revenue models to sustain their services.
Impact on Digital Payment Users
The introduction of convenience fees has led to mixed reactions among digital payment users. While some consumers see it as a necessary step for fintech companies to sustain operations, others argue that these charges discourage the adoption of digital payments. Many users have taken to social media to express their dissatisfaction with the new charges, questioning whether digital transactions will remain as cost-effective as before.
While UPI-based payments linked directly to bank accounts remain free, there is growing uncertainty about whether additional charges could be introduced for other digital payment services in the future. The move by major fintech players like Google Pay, PhonePe, and Paytm highlights a shift in India’s digital payments ecosystem, as companies explore new ways to generate revenue beyond traditional merchant fees.
