Premium Ammo is exclusive to the iOS version of SAS: Zombie Assault 3, and it was added through a recent
Ammo Indicators

Ammo Indicators for a weapon with Premium Ammo (Left) and for a weapon without Premium Ammo (Right). Notice the colors of the text in each indicator.

update. Premium Ammo increases a weapon's damage by a noticable amount, despite it being very costly, as it is three times the price of standard ammo. You can upgrade a weapon class or a special weapon's ammo to Premium by purchasing it in the shop. When it is bought for the first time, it will appear as though you have lost all your regular ammo. This should not worry the player as regular ammo can be recovered by burning through all the Premium Ammo you have purchased for a weapon or class. Because of this, a strategy involving expending Premium Ammo to reach the standard ammo you have stockpiled can be utilized by the player, which allows them to avoid the dangerous task of buying ammo during the middle of a Co-Op game, where pausing is not allowed. You can also buy premium ammo from the in-game menu.

Muzzle flash of a weapon firing Premium Ammo.

In game, weapons with the upgrade will have large muzzle flashes, and the CAW will fire green beams instead of blue ones. In addition, weapons with the upgrade will have a yellow ammo indicator, rather than a white one.

As far as i can see, the premium ammo does not affect any visuals on the RPG-7. i am pretty sure it still increases damage, but it has no visual notification of being premium ammo besides the ammo indicator. (that i have seen.) - Sperm Whale

To add to the RPG note, I have not noticed any large differences when firing the MGL-140 with Premium Ammo. - TrulyEpic

I play this game, and the difference for the RPG when it has premium ammo vs. regular ammo is a bigger explosion. -Anonymous