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.
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.
This marks a departure from Google Pay's previous practice of not charging extra for such transactions. The introduction of this convenience fee brings Google Pay in line with other payment platforms like Paytm and PhonePe, which already impose charges for similar services.
Convenience fees is a small percentage of your transaction amount imposed as an additional charge by third-party wallets for the convenience of using their platform. While these fees may seem nominal, they can quickly add up, especially for frequent mobile recharges.
Google Pay won't charge you a fee when you use your phone or other smart device to tap and pay, or to make a payment online. However, that doesn't necessarily mean your purchases will come with zero fees — as your own card issuer might have charges you need to take into consideration.
Convenience fees are normally a flat fee or a small percentage of the total payment, but they can add up to a substantial sum if the payments are large or recurring. You may be able to avoid convenience fees by paying with cash or another form of payment.
You can avoid this extra amount by recharging using your telecom service provider's official website or app and completing the payment via any of the UPI apps.
A convenience fee is a charge you pass on to your customers for using a payment method that is not standard for your business. For example, let's say you run a movie theater and typically sell tickets at the box office, where you can accept cash and may have a low-cost credit card processor.
While the rewards you earn from a credit card can help offset some of the cost of the fee, the charge is often more than what you'd earn in cash back, points or miles. As a result, it's best to avoid credit card convenience fees in most cases. Here's what you need to know.
Seeing retailers offer discounts for cash payments — or assess fees when customers pay by credit card — is becoming more common than ever. In most U.S. states, adding convenience fees to credit card transactions is legal, but there are still rules businesses must follow when doing so.
The main difference between a convenience fee and service fee program (besides card brand naming conventions) is that the service fee program can only be used by certain limited qualifying merchants.
Google Wallet does not charge any fees for usage. The store vendor or the card issuer might. Also, third-party wallet companies do charge for their service.
This fee applies when users purchase prepaid plans through Google Pay, marking a change from the app's previous policy of not charging extra for such transactions. This recent move aligns Google Pay with other payment platforms like Paytm and PhonePe, which already impose charges for similar transactions.
Google Pay Charges Convenience Fee: Know all the latest details about this new update here. Google Pay has officially introduced a new charge of Rs 3 for people who wish to recharge their phones using the UPI service. It is important to note that the fee will be charged when users buy prepaid plans through Google Pay.
The best way to avoid foreign transaction fees is to acquire a no-foreign-transaction-fees credit card, if you qualify for one. Next in line are checking accounts or debit cards with no foreign transaction fee. It is also possible to avoid the fee by paying in the local currency for purchases.
When you use a payment method through a Google service, during a purchase or with autofill on Chrome, you may find a charge on your account with the descriptor GOOGLE *TEMPORARY HOLD. This is a pending charge performed to verify that your card account is valid. When the transaction goes through, the hold will go away.
Find the subscription you want to cancel and tap or click Manage.
Choose Cancel subscription. If you don't find this option, click Manage subscription to go to the Google product you subscribed through. You can cancel the subscription there.
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