Will you have to pay to use UPI? 7 FAQs on possible MDR & what it means for consumers
The government is expected to permit a Merchant Discount Rate (MDR) of between 0.25% and 0.4% on UPI transactions above Rs 2,000 made to businesses, while person-to-person payments are likely to remain outside the scope of the proposed levy. The proposal is not expected to affect routine purchases such as milk, vegetables, groceries or payments for auto-rickshaw and taxi services.
After the Lok Sabha passed a bill amending the Payment and Settlement Systems Act, banks and payment service providers could start imposing charges on transactions through UPI and other electronic payment modes. This rule change removes the previous legal restriction that prevented such charges. The government plans to allow an MDR of 0.25% to 0.4% on UPI transactions over Rs 2,000 to businesses, but person-to-person payments will likely be exempt from this fee.
Written by urgent.news from Times of India's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
