UPI transactions rise 27% to 145 billion in H1 FY27 ahead of new MDR
UPI transaction volumes in India grew 27% in the first half of FY27, though monthly growth saw a slight dip in September. Starting October 15, a new merchant discount rate (MDR) of 0.4% will apply to UPI transactions exceeding Rs 2,000 to ensure ecosystem sustainability.
Why it matters
The introduction of MDR on high-value UPI transactions marks a significant shift in India's digital payment landscape, moving toward a revenue-generating model for service providers.
UPI's digital tap-to-pay habit appears to be getting stronger by the month. The platform processed around 145 billion transactions in the first half of the current financial year, up 27% from 114 billion in the same period last year, according to National Payments Corporation of India (NPCI) data.The value of those transactions rose at a slightly slower clip, climbing 20% to Rs 177 lakh crore from Rs 148 lakh crore a year earlier.However, September numbers showed a marginal month-on-month decline in both UPI volume and value. During the month, transaction volume stood at 24.07 billion, down 1.7% from 24.5 billion in August. The value of transactions fell 1.5% to Rs 29.37 lakh crore from Rs 29.82 lakh crore in the previous month.The monthly decline, however, needs to be viewed in the context of the difference in the number of days in the two months.
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