Centre Defends UPI MDR Plan as Retailers Warn of Higher Acceptance Costs
The finance ministry said MDR on select high-value UPI payments would strengthen domestic payment players and RuPay. Retail and fuel-dealer bodies say the proposed fees could discourage UPI acceptance and ultimately raise consumer costs, while fintechs see a new revenue stream.
What happened
India’s finance ministry defended MDR on select high-value UPI payments, saying it supports domestic payment players and RuPay. Retailer and fuel-dealer groups
Key facts
- 0.4% standard MDR on select high-value UPI transactions
- ₹2,000 transaction threshold
- ₹5 flat MDR for fuel, insurance, railways, telecom and utility payments above ₹2,000
- 0.02% MDR for UPI transactions involving mutual funds, securities and stockbrokers
- ₹300 cap on securities-related MDR
- 0.28% issuer-bank interchange
- 0.12% payer-side payment service provider share
- 0.08% UPI app provider share
- 30% proposed TPAP market-share cap
Why this matters
Payments companies should evaluate partnerships with RuPay, acquiring banks and merchant platforms to capture high-value UPI volume while helping retailers manage incremental acceptance costs.
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