Free to fee: 0.4% on UPI payments over Rs 2,000

NEW DELHI: National Payments Corporation of India on Tuesday announced a 0.4% merchant discount rate (MDR) on UPI transactions above Rs 2,000, with an overall cap of Rs 300, and a flat Rs 5 charge for utility payments, fuel purchase, insurance premium, rail tickets, and a host of government services.Despite MDR kicking in from October 15, person-to-person payments, such as UPI transfers to friends, will be exempt; auto-debits and UPI mandates will not attract charges either.Payments made to small merchants such as vegetable vendors, tea shops or kirana stores will be exempt from MDR if monthly UPI receipts for the merchant are under Rs 1 lakh.“Banks have been advised to ensure merchants do not pass MDR charges on to customers.