Proposed UPI MDR could create Rs 16,000–20,000 crore revenue pool by FY28
Brokerages estimate a 0.4% MDR on eligible UPI merchant payments above Rs 2,000, capped at Rs 300 per transaction, could unlock significant revenue for acquiring banks and payment firms including Paytm and Pine Labs.
What happened
Brokerages expect the proposed 0.4% MDR on eligible UPI merchant payments above Rs 2,000 to create a Rs 16,000-20,000 crore revenue pool by FY28, benefiting
Key facts
- 0.4% MDR on eligible P2M transactions above Rs 2,000
- Rs 300 maximum charge per transaction
- Rs 16,000-20,000 crore projected payments-industry revenue pool by FY28
- Rs 110 lakh crore annualised P2M transaction run-rate
- Paytm: about Rs 300 crore app revenue and Rs 600-700 crore merchant-acquiring revenue
- Pine Labs: Rs 160-180 crore projected revenue by FY28
- Banks projected to receive about 60% of total revenue
Why this matters
The proposal strengthens the strategic value of acquiring scale, merchant networks and UPI-processing capabilities, potentially making partnerships or acquisitions involving Paytm, Pine Labs and bank-led payment platforms more attractive.