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Nilekani backs UPI MDR, says a free system can't be relied on, as NPCI defers rollout past Diwali
Our read
NPCI will more likely than not announce a narrow UPI MDR after Diwali, with charges on the covered 4% of merchant transactions starting well after the original 15 October date.
For operators
NPCI has deferred the revised UPI MDR, which covers about 4% of merchant transactions, from 15 October past Diwali, so retailers keep current UPI checkout costs through the festive season but should plan for a charge, since Nilekani backs it and no rates or date are out.
Watch
NPCI notifying MDR rates and a start date before Diwali would mean the pause is short and charges on about 4% of merchant transactions are near.
Ask next
Which other rule changes affect Indian retailers this month?The report,
Nandan Nilekani said on Thursday that India's payments ecosystem cannot rely on a free system, backing UPI MDR. NPCI deferred the revised MDR, which covers about 4% of merchant transactions, from 15 October for the festive season. No new rates or date were announced.
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Channel facts
From the report. Source details below
| Flat MDR on select categories above Rs 2,000: | Rs 5 |
|---|---|
| Large merchant MDR under earlier framework: | 0.4% |
| MDR cap on large merchant payments: | Rs 300 |
| Person-to-merchant transactions outside framework: | More than 95% |
Signals to track
- NPCI circular listing the revised MDR slabs and merchant categories covered
- Bank and payment-app commentary on UPI processing costs in their next quarterly results
- Any Finance Ministry or RBI signal on continuing or ending support for zero-MDR UPI
- Merchant body statements on surcharges or steering customers away from UPI
The source
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