Now Reading: Govt says UPI stays free for users, MDR only on large merchant payments
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Govt says UPI stays free for users, MDR only on large merchant payments
Govt says UPI stays free for users, MDR only on large merchant payments
The finance ministry has clarified that UPI will remain free for all users, with no transaction charges on person-to-person payments. Any future merchant discount rate (MDR) will apply only to a limited…
The Story in Brief
The finance ministry has clarified that UPI will remain free for all users, with no transaction charges on person-to-person payments. Any future merchant discount rate (MDR) will apply only to a limited set of high-value merchant transactions above a threshold and at a nominal rate lower than debit or credit card MDRs, the government said on Saturday.
The clarification follows the Lok Sabha passing a Bill to amend the Payment and Settlement Systems Act, which critics misinterpreted as a blanket fee on UPI. The government called the amendment an enabling provision for UPI's long-term sustainability, citing rising needs for cybersecurity and infrastructure. UPI processed 2,366 crore transactions worth Rs 29.9 lakh crore in July 2026 alone.
The Indian Opinion
The government has done well to clarify, but the noise shows how touchy Indians are about UPI charges. Some narratives paint this as a secret tax on the poor or a surrender to foreign pressure. In reality, no one using UPI for chai or kirana will pay a rupee. The real test is the threshold and the rate the NPCI committee eventually sets. Will it hit small shopkeepers or only Walmart-sized merchants? That one number will settle whether this is a pragmatic fix or a slipped promise.
Sources (2): timesnownews.com, thefederal.com
This story was synthesised by AI from the 2 sources linked above.
