Finance Ministry bill could enable MDR on select UPI merchant payments
A proposed amendment would allow the government to determine which digital payment modes can carry merchant discount rates. Reports suggest UPI transactions above Rs 2,000 may be considered for a 25–30 bps levy, while person-to-person transfers would remain free, subject to legislation, notification and RBI rules.
Finance Ministry’s proposed amendment lets the government decide which digital payment methods may attract MDR. Discussions reportedly target merchant UPI payments above Rs 2,000, potentially at 25-30 bps, while P2P transfers are expected to remain free.
Why this matters
The proposal follows recent signals that the Tax Bill could remove the blanket zero-MDR bar for UPI and RuPay debit payments, and that MDR may return for UPI transactions at large merchants.
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