PhonePe to Charge Rs 100 Inactivity Fee for Unused Wallets After 1 Year

​PhonePe will soon introduce a Rs 100 inactivity maintenance fee for wallets left unused for 365 days. The company updated its wallet guidelines, stating that the fee applies if there are no wallet transactions for a full year. This change has sparked criticism online, as many users rely on UPI payments directly from their bank accounts rather than using the PhonePe wallet.

Key Highlights

• PhonePe will charge a Rs 100 inactivity fee for wallets unused for 365 days.
• Users must complete at least one wallet transaction per year to avoid the fee.
• A 15-day notice will be given before the inactivity fee is deducted.
• Other fintech platforms like MobiKwik and Airtel Payments Bank have similar policies.

Details of the Inactivity Fee

The Rs 100 inactivity fee will only affect users who do not make any wallet transactions for a year. Actions such as opening the PhonePe app or making UPI payments will not count as wallet activity. To avoid the charge, users must complete at least one wallet transaction within 365 days.

PhonePe will notify users 15 days before deducting the inactivity fee. If the wallet balance is at least Rs 100, the company will deduct the full amount. If the balance is less than Rs 100, PhonePe will take the available amount, and the wallet balance will drop to zero. The wallet will not go into a negative balance.

Industry Context and Previous Policies

Inactivity fees are not new in the digital payments sector. Other fintech platforms have also imposed similar charges for unused wallets. In 2021, MobiKwik introduced an inactivity fee for wallets left unused for extended periods.

Airtel Payments Bank previously had a wallet maintenance fee policy. Under its earlier terms, Airtel could charge Rs 20 if a wallet remained inactive for three months. The company deducted the fee from the existing wallet balance. Later, Airtel shifted to an Annual Maintenance Charge (AMC) system. Under this system, active wallets are charged Rs 75 per year, excluding GST, collected in quarterly installments.

User Reactions and Next Steps

Some users have expressed concern about the new fee. Abhishek Yadav, known as @yabhishekhd on X, noted that many people do not use the PhonePe wallet and prefer UPI payments. Some users described the fee as a charge for a feature they do not use.

To avoid the Rs 100 inactivity fee, PhonePe users should ensure they make at least one wallet transaction each year. The company will provide a 15-day notice before any deduction, allowing users time to reactivate their wallets if needed.