NPCI chief says three-fourths of merchants shielded from UPI charges

The National Payments Corporation of India has sought to ease concerns about merchant discount rate charges on UPI transactions, with CEO Dilip Asbe stating that approximately 75 per cent of merchants will be insulated from the new fee structure.

Asbe clarified that while most merchants would face no direct MDR liability, the revenue collected would be concentrated among a smaller segment of high-performing businesses. Roughly 80 per cent of the total MDR value is expected to be collected from enterprises recording annual gross merchandise value exceeding ₹1,000 crore, he indicated.

The clarification comes as the payments industry grapples with the introduction of MDR on UPI transactions, a move that has sparked discussion about impact on India's digital payment ecosystem. The NPCI's statement suggests the regulatory approach aims to protect smaller merchants and traders while enabling revenue generation from larger commercial entities.

The distinction between merchant coverage and revenue concentration reflects a tiered approach to fee implementation, potentially safeguarding India's extensive network of small and medium-sized retailers and traders who form the backbone of UPI adoption across the country.