{
  "id": 7902187,
  "title": "'No rethink': Govt firm on UPI merchant fee amid rollback demands",
  "url": "https://urgent.news/2026/09/16/no-rethink-govt-firm-on-upi-merchant-fee-amid-rollback-demands",
  "topic": "finance",
  "section": "Finance & Markets",
  "published": "2026-09-16T22:22:32.000Z",
  "source": {
    "name": "Times of India",
    "slug": "times-of-india",
    "url": "https://timesofindia.indiatimes.com/business/india-business/no-rethink-govt-firm-on-upi-fee-amid-rollback-demands/articleshow/134296667.cms"
  },
  "original_language": "en",
  "account": "New Delhi: The government has firmly stated that there will be no reconsideration of the 0.4% merchant discount rate (MDR) on person-to-merchant Unified Payments Interface (UPI) transactions, despite calls to remove the fee for small retailers, petroleum dealers, and brokers. These groups argue that their slim profit margins would be impacted by the charge. A senior government official clarified that the MDR was initially introduced for the betterment of the UPI ecosystem and to enhance its safety and security. The government maintains that the decision remains unchanged, as the new framework aims to make the system self-sustainable. Communications Minister Jyotiraditya Scindia emphasized that customers will not bear the additional cost, stressing that merchants cannot pass this charge to their clients, as that would violate the legal framework. The government asserts that only 4% of transactions will be affected, while person-to-person transfers will remain unaffected. Petroleum dealers have threatened to stop accepting digital payments above Rs 2,000 if they are not exempted from the new framework, which is set to commence next month. Smaller merchants may resort to using cash, according to a statement from a retailers' body. Digital payments currently account for 50-60% of petroleum dealers' daily sales, with 10-15% of these transactions being UPI payments above Rs 2,000. The United Petroleum Dealers Association criticized the government's move, arguing that it is unfair to penalize fuel retailers for accepting the infrastructure they have encouraged. The impact of the new fee would be more significant for smaller merchants with thin margins, according to industry associations. Retailers Association of India highlighted that the burden would be particularly challenging for MSME retailers, potentially prompting them to revert to cash transactions during the festive season. Nithin Kamath, CEO of Zerodha, expressed concerns about the possibility of brokers not being able to pass the UPI charge to customers, which could lead to an unlimited cost imposed on customers without generating any revenue. PhonePe CEO Sameer Nigam stated that 96% of transactions will be free from the MDR, with customers facing no charges and merchants being relieved of the fee for 96% of payments. NITI Aayog Vice Chairperson Ashok Kumar Lahiri urged businesses to find ways to become self-sufficient instead of relying on government subsidies.",
  "summary": "'Only 4% Of Transactions To Be Covered'",
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}