UPI sets 0.02% MDR cap for eligible capital-market payments

A concessional 0.02% MDR, capped at Rs 300, will apply to eligible UPI-funded capital-market transactions. The policy could push brokers and investment platforms to promote consolidated transfers, SIP mandates and lower-cost funding routes while deciding whether to absorb or recover the fee.

— Source publishedFri, 25 Sept, 2026, 23:14 IST·First seen Fri, 25 Sept, 2026, 23:46 IST·Source Financial Express · BrandWagon

What happened

Unified Payments Interface (UPI) · UPI will levy a concessional 0.02% MDR, capped at Rs 300, on eligible capital-market payments. Brokers and investment

Key facts

  • 0.02% MDR for eligible capital-market UPI payments
  • 0.04% baseline fee stated for other merchant transactions
  • 0.4% standard MDR referenced in the explainer
  • Rs 300 MDR cap
  • Rs 20 MDR on a Rs 1 lakh transfer
  • Rs 15 lakh transfer reaches the MDR cap

Why this matters

Payments, brokerage and wealth-platform buyers should view the policy as a modest tailwind for UPI-enabled funding integrations and recurring-investment infrastructure, particularly where high-value transactions benefit from the Rs 300 cap.

What to watch

  • NPCI, banks or acquiring partners publishing detailed eligibility, merchant-category, transaction-limit and settlement guidance.
  • Whether leading discount brokers explicitly absorb MDR or add customer-facing charges.
  • Changes in UPI payment success rates, average investment-funding ticket size and share of UPI-funded demat or mutual-fund transactions.
  • Adoption of UPI Autopay or eNACH for SIPs after platforms revise payment prompts.
  • Any regulator or industry clarification on whether the cap applies across broker funding, mutual-fund purchases, IPO applications and other capital-market use cases.
  • Brokerages will compare the new UPI MDR with net-banking, UPI Autopay, eNACH and bank-transfer costs, then update funding-route prompts in apps.
  • Large investment platforms may market fee-free UPI deposits, instant investment funding and consolidated portfolio transfers while absorbing the charge.
  • Platforms may set internal thresholds for when to absorb, recover or reroute the fee, especially for high-frequency and low-margin customer segments.
  • Payment orchestration providers may add transaction-type tagging and routing controls to ensure only eligible capital-market payments receive the concessional rate.
  • Broker and exchange operations teams will monitor reconciliation, refund handling and eligibility disputes before broad rollout.