The record
Written from the 1 report below. Nothing here is unsourced.
- The government has introduced a 0.4% Merchant Discount Rate (MDR) on UPI merchant transactions above ₹2,000.
- PhonePe co-founder and CEO Sameer Nigam welcomed the move, saying the revenue will help the industry recover operational costs and invest in expanding UPI.
- MobiKwik co-founder Upasana Taku called the charges a 'very positive step' that will make the payments ecosystem more sustainable.
- Customers will not pay any charge: person-to-person UPI payments, merchant payments up to ₹2,000, and small merchants with monthly sales around ₹1 lakh all remain exempt.
- The charge matters because the 0.4% rate is far lower than the 1.5–2.5% typically charged on credit card transactions, and it supports banks and payment firms that maintain UPI infrastructure.
What to watch next
- Whether banks and merchants pass on the MDR cost to customers despite government advisories.
- How critics of the MDR charges respond as the debate around UPI transaction fees continues.
- Whether the new revenue actually funds further growth and expansion of the UPI ecosystem.
Who said what2
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Upasana Taku
MobiKwik co-founder
1 quote · 1 outlet
“It is a very positive step for India.”
In the article
…companies. Taku said that with the rise of Unified Payments Interface, the cost of maintaining the infrastructure has increased, with the burden falling on banks and payment companies to support those costs. Deep Dive " It is a very positive step for India. UPI completed 10 years this year, and because of UPI, digital payments have scaled massively in India, with almost everyone using them. But as UPI has grown, the cost of maintaining the infrastructure has also…
Sameer Nigam
Founder & CEO of PhonePe
1 quote · 1 outlet
“We have consistently raised this issue with the government and the RBI...Digital payment systems operate in more than 200 countries worldwide, yet India was the only country where UPI transactions carried no MDR.”
In the article
…that the government’s decision to introduce a 0.4 per cent Merchant Discount Rate (MDR) on merchant-related UPI transactions above ₹2,000 will help industry generate revenue that can be reinvested into further growth. “ We have consistently raised this issue with the government and the RBI...Digital payment systems operate in more than 200 countries worldwide, yet India was the only country where UPI transactions carried no MDR. Now that a limited MDR has been introduced, we hope it will contribute to the further growth of the UPI ecosystem. This additional revenue will enable the industry to invest more in expanding UPI,” he added. Nigam said…
Coverage1
All filed from India
Named India · Government of India · MobiKwik · PhonePe · Reserve Bank of India · Sameer Nigam · Unified Payments Interface · Upasana Taku
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