# Government clarifies UPI charges only for large merchant transactions 2026-08-09T21:21:42+00:00 | Governance | Indian Opinion Desk Corroboration: 1 independent outlet The government has clarified that UPI users will not be charged under a proposed Merchant Discount Rate (MDR), which will apply only to select merchant transactions above a certain threshold. Finance minister Nirmala Sitharaman said person-to-person transfers will remain free. The clarification follows the Lok Sabha's passage of the Taxation and Other Laws (Amendment) Bill, 2026, which removes the legal ban on levying MDR on electronic payments, Deccan Chronicle reports. According to Deccan Chronicle, the MDR could be set at 0.5 to 0.75 per cent, lower than the one to three per cent charged by Visa and Mastercard. Only four per cent of UPI transactions exceed Rs 2,000, but these account for two-thirds of UPI payments by value. Experts warn merchants may pass on the charge to customers by embedding it in product prices or calling it a 'platform fee', though the government says it will prevent such practices. ## Coverage - deccanchronicle.com - deccanchronicle.com - ndtvprofit.com Tags: consumer fees, digital payments, MDR, NPCI, RBI, UPI Canonical: https://indianopinion.org/upi-merchant-fee-set-to-return-after-seven-years/ License: Summary and commentary (c) Indian Opinion, reusable with attribution. Facts belong to the linked sources. Cite: https://indianopinion.org/upi-merchant-fee-set-to-return-after-seven-years/#story-in-brief Review state: restored archive article, accurate at time of publication, not offered to search indexes.