NPCI to levy 0.4% MDR on UPI merchant payments above ₹2,000 from Oct. 15
The new merchant discount rate, capped at ₹300 for transactions of ₹75,000 and above, could create an estimated ₹10,000–20,600 crore annual revenue pool for banks and payment firms. CMS Info Systems and Radiant Cash Management shares rose on the news.
What happened
National Payments Corporation of India · NPCI will levy 0.4% MDR on merchant UPI payments above Rs 2,000 from October 15, creating a potential Rs 10,000-20,600
Key facts
- 0.4% MDR on person-to-merchant UPI transactions above Rs 2,000
- MDR capped at Rs 300 for payments of Rs 75,000 and above
- Estimated annual industry revenue pool: Rs 10,000 crore to Rs 20,600 crore
- CMS Info Systems rose as much as 7.22% to Rs 239
- Radiant Cash Management rose as much as 10.03% to Rs 39.49
What changed
NPCI will levy 0.4% MDR on merchant UPI payments above Rs 2,000 from October 15, creating a potential Rs 10,000-20,600 crore annual revenue pool for banks and payment firms. CMS Info and Radiant Cash Management shares rallied.
Why this matters
The proposed MDR creates a sizable new revenue pool for banks and payment firms, supporting the positive read-through for CMS Info Systems and Radiant Cash Management while implementation details remain key.
What to watch
- Final NPCI circular: scope, exclusions, treatment of QR-based payments, effective date, tax treatment and MDR distribution among issuers, acquirers and apps.
- Merchant association response and whether major retail, fuel, travel, healthcare and education chains announce payment-policy changes.
- UPI transaction-value growth above versus below ₹2,000 after Oct. 15, including changes in average ticket size and transaction splitting.
- RBI, finance ministry or NPCI statements on subsidies, zero-MDR policy continuity and potential caps or exemptions.
- Movement in card, cash, net-banking and BNPL share for high-ticket merchant payments.