New Delhi: The government and NPCI have spoken the implementation of the new Merchant Discount Rate (MDR) framework regarding UPI payments. From October 15, 2026, 0.4% MDR will be workable on Person-to-Merchant (P2M) UPI payments whilom Rs 2,000. However, this fee will not be charged from the consumer but will be taken under the merchant payment ecosystem. The maximum limit of MDR on transactions of Rs 75,000 or increasingly will be Rs 300 per transaction.
Will there be a tuition for sending money through UPI?
Person-to-Person UPI transactions washed-up from one person to flipside will be completely free, no matter the amount. The government has moreover clarified that UPI app providers will not be worldly-wise to tuition platform fees or subconscious charges from any person.
What will happen to UPI payments up to Rs 2,000?
MDR will not be levied on UPI payments up to Rs 2,000 made to merchants. According to the government, a large part of small value transactions come under this scope, so most of the everyday UPI payments will not be unauthentic by the new system.
How much MDR will be charged on payments whilom Rs 2,000?
MDR has been stock-still at 0.4% for amounts whilom Rs 2,000 on normal P2M transactions. Whereas on transactions of Rs 75,000 or more, this fee will be limited to a maximum of Rs 300 per transaction. For example, on a normal merchant payment of Rs 10,000, the MDR would be Rs 40, while on a payment of Rs 1 lakh, the MDR would be Rs 400 @ 0.4%, but due to the maximum limit, the MDR would be Rs 300.
How much is charged on petrol, insurance and telecom payments?
Separate arrangements have been made for some essential and low margin sectors. UPI payments whilom Rs 2,000 in categories like railways, telecom, insurance and fuel will vamp a unappetizing MDR of Rs 5 instead of 0.4%. Some transactions involving agricultural inputs are moreover included in this special arrangement.
Will small shopkeepers get discounts?
Small merchants receiving up to Rs 1 lakh per month through UPI QR will protract to enjoy the goody of zero MDR under the P2PM category. According to the government, this will limit the impact of spare payment financing on small shopkeepers, street vendors and other small businessmen.
Can this tuition be recovered from the customer?
The government has well-considered banks to ensure that merchants do not pass the MDR undersong directly on to customers. Also, UPI app providers will not be unliable to tuition digital platform fees or subconscious charges.
Was the UPI fee structure reverted without six years?
Merchant payments in UPI were running under the zero-MDR system for a long time. The new framework aims to make the payments ecosystem sustainable in the long run and support the financing associated with the operation, expansion and security of UPI. The government has said that well-nigh 96% of P2M transactions will not be unauthentic by the new arrangement.
