Govt may delay rollout of MDR on UPI transactions above Rs 2,000: Report
The Indian government is considering delaying the implementation of a new Merchant Discount Rate (MDR) fee on UPI transactions over Rs 2,000. The delay aims to avoid disrupting consumer spending during the upcoming festive season.
Why it matters
The decision impacts the profitability of major Indian digital payment firms and the broader adoption of digital payment infrastructure.
Will the rollout of Merchant Discount Rate (MDR) on Unified Payments Interface (UPI) transactions be deferred to January 2027? The government may postpone the move which was scheduled to be effective from October 15, 2026, by a few months, according to a regulatory official and an industry executive familiar with the matter.Last month, the government ended the zero-fee regime for UPI by allowing merchants to be charged 0.4% on transactions above Rs 2,000. UPI is used by more than 500 million people across the country for payments ranging from roadside cups of tea to iPhones.The charge is scheduled to take effect on October 15, coinciding with the annual festive season, which runs from October through December and usually brings a significant increase in consumer spending.Sources told Reuters that the proposed postponement would prevent any disruption to retail payments during the festive period while giving payments companies additional time to prepare…
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