UPI Merchant Charges Above Rs 2,000 To Be Implemented After Diwali

NEW DELHI: Following a request from traders to delay UPI transaction charges, the rollout of Merchant Discount Rate (MDR) charges has been pushed to the second week of November, after Diwali.

“Keeping in mind the festive season, the UPI and Services Steering Committee today (October 13) decided that MDR on select Person-to-Merchant (P2M) UPI transactions shall be implemented immediately post Diwali,” NPCI said in a media statement on Tuesday. The new date of implementation will be notified later, the NPCI added.

The earlier rollout date was October 15. However, it coincided with the festive shopping season, when consumer spending typically rises. Therefore, the rollout was delayed to give payment firms and consumers more time to update their systems and to address concerns about introducing the change during the festive season.

Earlier in September, the UPI Steering Committee fixed the UPI MDR at 0.4 per cent for transactions above Rs 2,000. MDR is the fee charged to merchants for processing digital payments. The 0.4 percent fee translates into Rs 8 per Rs 2,000 spent or Rs 40 for every Rs 10,000 paid using UPI. Meanwhile, payments above Rs 2,000 in select sectors such as railways, telecom, insurance, fuel and agricultural inputs will attract a flat MDR of Rs 5.