PhonePe says dormant wallet fee will not impact UPI, bank accounts
22 Jun 2026, 12:32 PMThe clarification comes after some users received notifications stating that wallets inactive for more than 12 months could attract a maintenance charge of up to Rs 100 per quarter.
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PhonePe has clarified that the inactivity fee charged on dormant wallets applies only to balances held in its prepaid wallet service and will not affect users' linked bank accounts or UPI transactions.
The clarification comes after some users received notifications stating that wallets inactive for more than 12 months could attract a maintenance charge of up to Rs 100 per quarter, triggering concerns that the fee could be recovered through bank accounts or UPI payments.
The company said its wallet is a prepaid payment instrument (PPI) regulated separately from bank accounts. If a dormant wallet has no balance, no fee will be deducted through a customer's linked bank account or UPI account, it said.
PhonePe also clarified that wallet balances will not become negative due to inactivity charges.
The company noted that users may continue making payments through UPI while leaving their PhonePe wallet unused. As a result, customers can receive inactivity notifications even if they remain active on the platform, since wallet usage and UPI transactions are tracked separately.
According to PhonePe, users receive a 15-day advance notice before any inactivity fee is deducted, allowing them to reactivate the wallet, add funds, withdraw eligible balances, or stop using the service.
The company said maintenance fees on inactive prepaid wallets are intended to offset operational and regulatory compliance costs and are a standard practice across the digital wallet industry.
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