SEBI To Review Stockbrokers’ Concerns Over New UPI MDR Charges On Market Transactions: Tuhin Kanta Pandey

SEBI Chairman Tuhin Kanta Pandey announced that the markets regulator would review concerns raised by stockbrokers about the new Merchant Discount Rate (MDR) structure for UPI transactions, according to a report from the NaBFID Infrastructure Conclave 2026. The MDR is set at 0.02% for payments to stockbrokers and dealers, with a maximum cap of Rs 300 per transaction since October 15.

Concerns were raised about the potential financial impact on brokerage operations, as the fee would be charged on fund transfers into trading accounts, even if those funds are not used for executing any trades. This could increase operational expenses for brokerage firms. Zerodha co-founder Nithin Kamath also expressed concerns, suggesting that brokers might bear these UPI-related costs when customers add money to their accounts without placing trades.

The aim of the MDR on selected UPI transactions is to establish a sustainable revenue framework for digital payments, but brokers have sought clarity on how the charges will be applied and whether adjustments are needed to avoid unnecessary costs from non-trading fund transfers.