India has postponed the rollout of a fee on large payments via its popular Unified Payments Interface platform until after Diwali, the National Payments Corporation of India said on Tuesday.
The 0.4% charge for merchants on transactions exceeding 2,000 rupees ($21) was scheduled to take effect on October 15.
The deferral is "keeping in mind the festive season", and the fee will be implemented immediately after the Hindu festival on a date that will be notified separately, NPCI said in a statement.
Diwali, which will be celebrated across India on November 8, typically marks the peak of consumer spending in Asia's third-largest economy, with shoppers splurging on cars, clothes and home appliances.
The proposed fee, which would end more than six years of zero-cost UPI payments in India, had drawn opposition from retailers and a large broker.
UPI is used by over 500 million people to buy everything from cups of tea to iPhones. Walmart's PhonePe and Alphabet's Google Pay had about 80% market share by value of UPI transactions in August.
The fee would have coincided with India's annual festive season that runs from October through December and typically sees a surge in consumer spending.
The delay in implementation would likely allow payments firms to upgrade systems and not pass on costs to customers, while addressing issues that retailers may face during the festive period, Reuters reported last week, citing sources.
