UPI remains free for now, but proposed law revives MDR questions for merchants
The Taxation and Other Laws (Amendment) Bill, 2026 does not immediately introduce UPI charges. It could, however, change how zero-MDR payment modes are designated, leaving future merchant discount rate policy to a Finance Ministry notification. Any MDR shift could raise acceptance costs for retailers.
The proposed Bill may shift how zero-MDR payment modes are designated, sparking concern over future UPI merchant charges. Experts say it preserves the current regime, but any later MDR policy could raise merchant costs and potentially consumer prices.
Why this matters
The bill follows signals that India is weighing UPI MDR for large merchants, RBI says a decision is premature, and higher-value payments could face MDR.
Retail-company signals are accelerating, up +208929% QoQ.