Business
UPI to Remain Free as Government Addresses Concerns Over Future MDR
The government has assured consumers and small merchants that UPI transactions will continue to remain free, addressing concerns over possible charges following the passage of a Bill amending the Payment and Settlement Systems Act, 2007.
NEW DELHI: The government on Saturday clarified that consumers and small merchants will continue to receive Unified Payments Interface (UPI) services free of charge, seeking to address concerns about the possible introduction of transaction fees following the passage of a Bill to amend the Payment and Settlement Systems Act, 2007.
The Finance Ministry said any Merchant Discount Rate (MDR), if introduced in the future, would apply only to a limited category of merchant transactions and would be subject to a specified threshold.
According to the ministry, the proposed charges would be nominal and significantly lower than the MDRs generally associated with debit and credit card transactions. The clarification is aimed at reassuring consumers and small businesses that everyday UPI payments will not become a paid service.
The government has emphasized that the digital payment ecosystem will continue to support widespread UPI adoption, while any future merchant charges would be restricted to specific transactions rather than being imposed universally.