Politics · India Bureau
Government stands firm on 0.4% UPI merchant discount rate above ₹2,000
A government official has ruled out any reconsideration of the merchant discount rate (MDR) on UPI payments exceeding ₹2,000, clarifying that the charge will be borne by merchants rather than consumers.
LSN India ·
The government has reaffirmed its commitment to implementing a 0.4 per cent merchant discount rate on UPI transactions above ₹2,000, with an official stating there is no question of revisiting the policy decision.
The MDR will be applied within the merchant payment ecosystem, ensuring that the burden falls on merchants conducting high-value digital transactions rather than on consumers making purchases. This distinction is crucial as it aims to protect end-users from bearing additional costs while maintaining incentives for digital payment adoption among merchants.
The policy is designed to encourage the growth of digital payments in India while ensuring that the merchant community shares the infrastructure costs of the UPI network. By keeping the fee structure merchant-centric, the government aims to sustain consumer confidence in cashless transactions without creating barriers to adoption.
The clarification comes as stakeholders in the payments ecosystem seek certainty on the implementation timeline and operational aspects of the new MDR structure for high-value UPI transactions.