India’s click-and-pay UPI services will attract a fractional charge above Rs 2,000 for merchant payments, the government has notified, though it ruled out charging for person-to-person transactions. The new UPI Merchant Discount Rate (MDR) framework will be effective from October 15.
This additional charge shall not be passed on to the customers, the Finance Ministry has stated. “Consumers will continue to transact free of cost using UPI as they have been doing till now. The new framework suggests a 0.4% charge will be levied on transactions made by consumers to merchants, according to the National Payments Corporation of India (NPCI)’s new Unified Payments Interface (UPI) rules. For merchant categories like railways, telecom services, insurance, and fuel, the NPCI stated a flat rate of Rs 5 will be levied on UPI payments above Rs 2,000. Person-to-Person (P2P) transactions and Person-to-Merchant (P2M) transactions up to Rs 2,000 remain outside the scope of MDR,” NPCI said.
