Report flags proposed 0.4% MDR on UPI merchant payments above ₹2,000
A Business Today report says a proposed UPI MDR from 15 October 2026 could levy 0.4% on P2M payments above ₹2,000. It adds that repeatedly splitting bills to stay below the threshold may trigger bank fraud-monitoring checks.
What happened
प्रस्तावित UPI MDR के तहत ₹2,000 से ऊपर P2M भुगतान पर 0.4% शुल्क लग सकता है। बिल को छोटे भुगतानों में बांटने से MDR बच सकता है, लेकिन बार-बार समान भुगतान बैंक
Key facts
- ₹2,000
- 0.4%
- ₹75,000
- ₹300
- ₹6,000
- ₹24
- 15 October
Why this matters
Use the potential MDR change to reassess payment-acquirer, gateway and alternative-rail partnerships for high-ticket UPI transactions, while avoiding commitments until the policy and implementation details are confirmed.
What to watch
- Official notification, NPCI circular, RBI communication, or government clarification confirming whether an MDR change is proposed, approved, or effective.
- Definition of covered P2M transactions, merchant categories, transaction threshold calculation, and whether the ₹2,000 limit applies per payment, invoice, customer, or day.
- Confirmation of who bears the charge: merchant, acquirer, issuer, PSP, customer, or a shared arrangement.
- Exemptions for small merchants, essential goods, government payments, education, healthcare, utilities, and QR-based micro-merchants.
- Acquirer and payment-gateway pricing notices, including pass-through fees beyond the stated MDR.
- UPI volume and average-ticket trends around the announcement period, especially shifts from high-ticket UPI to cards, cash, EMI, or credit-on-UPI.
- Bank and NPCI guidance on fraud-monitoring treatment of repeated split payments.
- Model margin exposure by UPI ticket size, merchant category, and current payment mix; isolate transactions above ₹2,000.
- Review checkout and POS routing to ensure compliant, transparent payment-option steering if acceptance costs rise.
- Avoid encouraging artificial bill-splitting; update frontline scripts and app flows to prevent behavior that could resemble fraud evasion.
- Engage acquirers, banks, PSPs, and industry bodies for written clarification on scope, effective date, MDR bearer, taxes, exemptions, and settlement treatment.
- Prepare customer communications and pricing contingencies for high-ticket categories such as electronics, travel, healthcare, luxury, wholesale, and home improvement.
- Assess whether loyalty incentives, instant discounts, or card-linked offers need adjustment if UPI economics change.