PhonePe has introduced a ₹100 quarterly wallet inactivity maintenance fee for dormant accounts, triggering widespread backlash among users who primarily rely on UPI rather than maintaining wallet balances.
Policy Details
• Inactivity Definition : A wallet becomes inactive if there are no financial transactions (such as adding money to the wallet or spending directly from it) for 365 days.
• Regular actions like logging into the app, UPI payments from linked bank accounts, recharges, bill payments, or KYC updates do not count as wallet activity.
• Fee Deduction : The fee is deducted from the wallet balance. If the balance is less than ₹100, PhonePe will debit the entire available amount, bringing it to zero (balance will not go negative).
• Notice Period : Users receive multiple notifications over 15 days before the fee is charged. Performing a qualifying wallet transaction during this period reactivates the wallet and prevents the deduction.
PhonePe has stated that the fee helps cover ongoing costs for platform maintenance, security updates, and improvements to enhance user experience.
Why the Backlash ?
Many users were unaware of the policy, as most prefer direct UPI transfers over holding wallet balances. Social media reactions have been critical, with users calling it a charge for a rarely used feature and advising others to withdraw any remaining balances.
How to Avoid the Fee
1. Reactivate your wallet by making at least one financial transaction using the PhonePe Wallet balance.
2. Check wallet activity in the app and withdraw small unused balances if you don’t plan to use the wallet feature.
3. Respond promptly to any inactivity notifications from PhonePe.
Not the First in the Industry
Similar policies exist elsewhere :
• MobiKwik introduced wallet maintenance fees in 2021.
• Airtel Payments Bank has implemented comparable inactivity charges, including quarterly or annual fees for dormant wallets.
For most everyday transactions, direct bank-linked UPI remains free and hassle-free. Users with any balance in their PhonePe Wallet are advised to check the app or terms for their status and act accordingly. Always refer to the latest guidelines in the PhonePe app.