BharatPe Backs UPI MDR Plan, Says 96% of Merchant Payments Stay Unaffected

BharatPe said the proposed UPI MDR framework would retain free consumer payments and zero MDR for small merchants. A 0.4% fee would apply to merchant transactions above ₹2,000 from October 15, according to the company.

— Source publishedThu, 17 Sept, 2026, 16:54 IST·First seen Thu, 17 Sept, 2026, 16:58 IST·Source Outlook Business

What happened

BharatPe supports the new UPI MDR framework, saying it preserves free consumer payments and zero MDR for small merchants while funding payment infrastructure

Key facts

  • 0.4% MDR fee
  • ₹2,000 transaction threshold
  • October 15 implementation
  • 96% of P2M transactions unaffected
  • nearly six years of free UPI payments
  • 2024

Why this matters

Payments and retail platforms may find new partnership and pricing opportunities in enterprise checkout, reconciliation, and routing services as larger-ticket UPI acceptance begins carrying MDR.

What to watch

  • Formal NPCI, RBI or government notification confirming the ₹2,000 threshold, 0.4% rate, implementation date and any GST treatment.
  • Clarity on MDR allocation among issuer banks, acquiring banks, payment aggregators, TPAPs and network participants.
  • Rules on merchant pass-through, checkout disclosure and enforcement against surcharging or transaction splitting.
  • Merchant association reactions from organized retail, travel, healthcare, education and electronics sectors.
  • Changes in UPI average ticket size, high-value P2M transaction volumes and card-versus-UPI payment mix after rollout.
  • Payment aggregators and PSPs will revise merchant pricing, settlement disclosures and threshold-based routing rules ahead of the proposed October 15 start.
  • Large retailers will model whether to absorb MDR, raise prices broadly, negotiate acquiring rates or steer high-value customers toward lower-cost payment methods.
  • Fintechs may target enterprise merchants with reconciliation, fraud controls, credit and loyalty bundles funded partly by new MDR revenue.
  • UPI participants will increase monitoring for transaction splitting, duplicate invoices and attempts to reclassify merchant payments as peer-to-peer transfers.