Parliament panel never discussed MDR charges on UPI, says Gogoi

Congress Member of Parliament Gaurav Gogoi on Tuesday alleged that a parliamentary standing committee did not engage in substantive discussions regarding proposed Merchant Discount Rate (MDR) charges on UPI transactions. Gogoi stated that government representatives who appeared before the committee did not offer specific or satisfactory responses when questioned about the rationale for introducing the new charges.

The allegation suggests a potential gap in stakeholder consultation on a policy that could significantly impact digital payment adoption in India. UPI, which has emerged as a cornerstone of India's digital payments infrastructure, processes millions of transactions daily and has been free for users and merchants.

Government authorities had flagged the potential introduction of MDR charges to improve the financial viability of payment service providers. However, the proposal has faced considerable pushback from fintech companies, merchants, and consumer advocates who argue it could reduce UPI's accessibility and competitiveness.

The parliamentary standing committee serves as a key forum for reviewing government policies before implementation. Gogoi's assertion that the committee was not provided adequate substantive information underscores ongoing tensions between policymakers and stakeholders over the fee structure for India's rapidly expanding digital payments ecosystem.