Proposed payments-law changes could open UPI to merchant discount rates
India may permit MDR on select UPI payments, potentially targeting transactions above Rs 2,000 at merchants with annual turnover above Rs 15 million. Rates and applicability are not final, but a carve-out for larger merchants could create new revenue for payment processors.
Proposed amendments to India’s payments law could enable MDR charges on UPI. Policymakers may target larger merchants and transactions above Rs 2,000, while keeping consumer and small-business payments free. Paytm and Pine Labs could benefit from new payment-processing revenue.
Why this matters
The proposal follows signals that India has opened the door to UPI merchant fees for large retailers, while 53% of surveyed users may avoid UPI payments above Rs 3,000 if MDR returns.
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