NPCI Proposes 0.4% MDR Fee on UPI Transactions Above Rs 2,000

29 Oct 2026, 8:00 am · 2h ago · 1 min read · Inc42New

The National Payments Corporation of India is preparing to introduce a merchant discount rate on select UPI person-to-merchant transactions after Diwali. Under the proposed framework, eligible transactions exceeding ₹2,000 will incur a 0.40% fee, capped at ₹300 per transaction. The plan faced opposition from groups like the All India Mobile Retailers Association and the All India Consumer Products Distributors Federation, though protest plans were withdrawn following talks with Finance Minister Nirmala Sitharaman. The Supreme Court declined to stay the policy. Meanwhile, UPI volumes dipped 1.8% to 24.07 billion transactions in September, totaling ₹29.37 lakh crore.