40-bps MDR could lift UPI’s cross-border acceptance, says JPMorgan
JPMorgan Global Payments says a 40-basis-point merchant discount rate could improve UPI’s competitiveness in cross-border payments. The bank is expanding payment connectivity for more than 100 multinational clients in GIFT City.
The channel move
JP Morgan Global Payments said a 40-basis-point merchant discount rate could make UPI more competitive for cross-border payments, while the bank expands payment connectivity for more than 100 multinational clients in GIFT City.
Channel facts
- 40-basis-point
- more than 100
What it means for online and offline
JPMorgan’s expanding GIFT City connectivity for 100-plus multinationals makes cross-border UPI acceptance a timely partnership and distribution opportunity for banks, PSPs, and merchant acquirers.
Signals to track
- Formal confirmation of the 40-bps MDR structure, including whether it applies to inbound international merchant transactions and who bears the fee.
- New UPI international merchant-acquiring agreements, especially in high-Indian-traveler destinations.
- Merchant settlement currency, FX spread, payout timing, and refund/dispute terms published by participating banks and PSPs.
- GIFT City client wins or expanded payment-connectivity products for multinational treasury and commerce platforms.
- Evidence of checkout conversion, transaction-frequency, and ticket-size gains versus international card payments.
- Regulatory developments on cross-border KYC, AML screening, data localization, and transaction caps.
- Prioritize UPI acceptance pilots with travel, hospitality, airport retail, luxury, education, and online merchants with high Indian-customer exposure.
- Package UPI acceptance with FX transparency, local-currency pricing, real-time reconciliation, and merchant settlement options rather than competing on MDR alone.
- Use GIFT City connectivity to offer multinationals centralized treasury, collection, and settlement workflows for India-linked payment flows.
- Build acquiring partnerships in priority corridors and establish standardized rules for refunds, chargebacks/disputes, transaction limits, compliance, and data handling.
- Monitor whether lower acceptance costs prompt merchants to steer Indian customers toward UPI via checkout placement or targeted incentives.
The counter-case
A 40-bps MDR alone may not materially change UPI’s cross-border acceptance. International merchants and acquirers care at least as much about FX spreads, settlement timing, chargeback/dispute rules, fraud controls, integration cost, tax compliance and consumer demand. A new fee could also weaken UPI’s low-cost proposition, while merchants may still prefer card rails with established acceptance, buyer protections and global operating standards.