Banks Cannot Impose Charges on UPI Payments of up to Rs 2,000, Govt Says
NPCI said the new fee will fund infrastructure, cybersecurity and fraud prevention as UPI processed 24.51 billion transactions in August.
- On Monday, the Finance Ministry specified that RuPay debit-card payments and Unified Payments Interface transactions up to Rs 2,000 are "electronic modes of payment," prohibiting banks from imposing direct or indirect charges on such transactions.
- Parliament passed the 2026 Taxation and Other Laws Amendment Bill in August, creating the legal framework for potential charges on digital payments, while this notification clarifies that small-value transactions remain free for consumers.
- Starting October 15, 2026, merchant UPI transactions exceeding Rs 2,000 will attract a 0.4% Merchant Discount Rate, capped at Rs 300 per transaction, according to the National Payments Corporation of India .
- Opposition Congress leaders criticized the framework, with Rahul Gandhi alleging the government has "quietly paved the way" for fees and Jairam Ramesh claiming the move opens digital payments to American firms.
- To ensure platform self-sustainability, NPCI indicated that MDR revenue will fund infrastructure, cybersecurity, and innovation, while protecting the more than 95% of transactions that fall below the Rs 2,000 threshold.
88 Articles
88 Articles
Centre introduces 0.4% MDR on UPI payments above ₹2,000 made to merchants
From October 15, a 0.4% merchant discount rate applies to UPI person-to-merchant payments over 2,000, with consumers unaffected; person-to-person.UPI charges, merchant discount rate, UPI payment changes, new UPI fees, digital payment updates, person-to-merchant payments, finance ministry UPI, NPCI transaction fees, UPI infrastructure investment, digital investing costs, essential sector payments, utility bill payments UPI, educational fee paymen…
UPI transactions above Rs 2,000 to attract 0.4% MDR, capped at Rs 300
UPI transactions above Rs 2,000 will attract a Merchant Discount Rate (MDR) of 0.4 per cent under a revised framework introduced by the National Payments Corporation of India (NPCI), while consumers will continue to transact free of cost using UPI.
Modi Govt Paving Way For UPI Fees, Surrendering To US Pressure: Congress Attacks BJP
The Congress has targeted the Modi government following a notificaiton on UPI transactions with Rahul Gandhi alleging that it has quietly paved the way for imposing fees on such transactions and that a 'compromised' Prime Minister Narendra Modi was 'once again surrendering' to American pressure.
Banks’ Panel to Soon Decide on UPI Merchant Charges Above Rs 2,000
According to sources, the committee would soon take decision on Merchant Discount Rate (MDR) on UPI transaction above Rs 2,000 based on various factors including self-sustainability and market expansion.
‘Quietly opened the door to UPI fees’: Rahul Gandhi slams Modi govt over UPI transaction charges
Rahul Gandhi accused the Modi government of opening the door to UPI transaction fees, alleging US pressure behind the move. The Centre's notification bars charges on UPI/RuPay payments up to ₹2,000, while citing cybersecurity and infrastructure costs as reasons for the broader MDR framework.
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