BharatPe backs UPI MDR plan as charges begin on merchant payments above ₹2,000
BharatPe has endorsed the proposed UPI merchant discount rate framework, distancing itself from former CEO Ashneer Grover’s criticism. The framework would impose a 0.4% MDR on merchant UPI transactions above ₹2,000 from October 15, while exempting consumers and eligible small merchants.
What happened
BharatPe backed India’s new UPI merchant MDR framework, separating its position from former CEO Ashneer Grover’s criticism. The policy will levy 0.4% MDR on
Key facts
- 0.4% MDR
- Rs 2,000
- October 15
- 96% of P2M transactions
- six years
- 2024
Why this matters
Payments acquirers, merchant SaaS platforms, and retailers may find new partnership or consolidation opportunities as larger merchants seek tools to manage MDR costs and optimize payment acceptance.
What to watch
- Final government or NPCI notification confirming the October 15 start date, scope, and legal basis.
- Clarification of which merchants qualify as exempt small merchants and how eligibility is verified.
- Whether the ₹2,000 threshold applies per transaction, aggregate purchase, split payments, refunds, or specific merchant categories.
- Acquirer and payment-app announcements on MDR pass-through, enterprise pricing, and settlement fees.
- Evidence of higher-ticket UPI volume falling, split-payment behavior rising, or card/EMI migration at large retailers.
- Merchant association lobbying, litigation, or public resistance from major marketplaces and retail chains.
- Consumer response to any visible surcharge or payment-method steering at checkout.
- Segment UPI transaction data by ticket size, merchant category, and store format to quantify exposure above ₹2,000.
- Model margin impact under partial absorption, customer surcharge, payment steering, and split-tender scenarios.
- Renegotiate PSP/acquirer contracts, focusing on effective MDR, volume rebates, settlement terms, and value-added service bundles.
- Prepare checkout messaging and staff guidance that avoids customer friction while offering alternative payment methods for high-value baskets.
- Review pricing, promotions, and basket-building tactics that could unintentionally push transactions above the threshold.
- Monitor competitor policies on UPI acceptance, card incentives, and payment-method-specific offers.