PhonePe wins in-principle UAE licences as India’s UPI merchant-fee regime begins
PhonePe has received in-principle UAE approval for payment and stored-value licences, marking its first overseas payments push. The move comes as India introduces MDR on specified UPI merchant payments above ₹2,000 from October 15, opening a new monetisation route for the fintech’s 700 million users and 50 million merchants.
What happened
PhonePe received in-principle UAE approvals for payment and stored-value licences, its first overseas payments-business move. The expansion follows India’s new
Key facts
- 0.4% MDR on specified P2M UPI transactions above ₹2,000
- ₹300 MDR cap per transaction
- 96% of P2M transactions expected unaffected
- 700 million registered users in India
- 50 million merchants in India
What changed
PhonePe received in-principle UAE approvals for payment and stored-value licences, its first overseas payments-business move. The expansion follows India’s new UPI MDR framework, creating a potential revenue pool for the fintech’s 700 million users and 50 million merchants.
Why this matters
PhonePe’s UAE entry could give merchants a new India-linked payments partner while domestic UPI MDR creates a clearer path to monetising higher-value transactions.
What to watch
- Timing and conditions of final UAE licence approvals.
- Whether UAE launch includes consumer wallet issuance, merchant acquiring, remittances, or only UPI-linked acceptance.
- MDR rate structure, eligible transaction categories and merchant pass-through behavior in India after October 15.
- Changes in PhonePe merchant payment volume, take rate, incentive spending and merchant churn for transactions above ₹2,000.
- Announced UAE bank, exchange-house, merchant-acquirer or government-payment partnerships.