No US pressure behind UPI MDR: Finance Ministry
The Finance Ministry has dismissed claims that the US exerted pressure to impose a 0.4% Merchant Discount Rate (MDR) on certain UPI payments. According to the Department of Financial Services (DFS), the decision is based on India's established policy framework for UPI, which currently allows only RuPay credit cards to be linked with UPI for credit transactions.
The MDR is aimed at creating a sustainable revenue model for the payments ecosystem and enabling domestic companies to compete. The NPCI, the entity operating UPI, announced the revised MDR framework on September 15, which will take effect from October 15. The charge will apply to select person-to-merchant (P2M) transactions above Rs 2,000, while consumers will continue to make UPI payments free of charge.
The Ministry also noted that the MDR decision is not influenced by external factors and emphasizes India's efforts to promote RuPay credit and debit cards as part of its strategy to build a domestic alternative in the payments market.
Written by urgent.news from The Economic Times's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
