SC refuses interim stay on MDR for UPI transactions, asks Centre to explain decision
The Supreme Court of India has issued a notice to the government regarding a challenge to new merchant discount rate (MDR) charges on high-value UPI transactions. While the court declined to stay the implementation of the charges, it questioned the legal basis for classifying these fees.
Why it matters
The case addresses the balance between digital payment adoption and the financial sustainability of payment infrastructure in India's rapidly growing fintech sector.
NEW DELHI: The Supreme Court has issued notice to the Centre, the Reserve Bank of India (RBI) and the National Payments Corporation of India (NPCI) on a plea challenging Gazette notifications introducing charges on commercial UPI transactions above Rs 2,000.A bench comprising Chief Justice of India Surya Kant and Justices Joymalya Bagchi and V Mohana was hearing a writ petition filed by advocate Anjan Datta challenging Gazette notifications issued by the Union Ministry of Finance on September 14 and 15.The court directed the Centre and other respondents to file their counter affidavits within four weeks, while observing that the issue was “less legal and more technical”."Is it tax or a fee? If not a fee, what is the executive basis for making this expropriation? What is the service?"
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