SBI expects surplus from new UPI MDR charges

State Bank of India (SBI) anticipates surplus revenue from new merchant discount rate (MDR) charges that will take effect on October 15, 2026, for UPI payments above Rs 2,000. This is the first time MDR has been levied on UPI transactions since 2020. As a large card issuing bank, SBI will receive 0.40% of the transaction amount as fees, while the acquiring bank will get 0.30%, payment gateways will receive 0.20%, and UPI applications will receive 0.10%.

SBI, being one of the largest card issuers and having a presence in UPI applications, expects to generate surplus revenue from these charges, though the official has not yet completed the calculations. The bank is also considering the impact of potential customer behavior, such as splitting transactions to avoid charges, which could increase volumes but not necessarily revenue and put pressure on the bank's systems.