The record
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- The Indian government has issued new UPI rules specifying which transactions will attract charges.
- Person-to-person UPI payments remain completely free, regardless of the amount involved.
- Merchant payments up to Rs 2,000 carry no charge, so small shops and most everyday purchases are unaffected.
- Payments to merchants above Rs 2,000 will attract a merchant discount rate (MDR) of 0.4 per cent, capped at Rs 300 per transaction.
- The government has instructed banks to ensure merchants do not pass this charge on to customers, which matters because UPI users had feared paying extra for the first time in ten years.
What to watch next
- Whether banks actually enforce the rule that merchants cannot recover MDR from customers
- Whether merchants raise prices or push more cash payments to offset the MDR cost
- Details of how MDR revenue will be shared among banks, payment providers and UPI app companies
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1 report
Indian-language1
All filed from India
Named India · Government of India · National Payments Corporation of India
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