NPCI to Introduce 0.4% MDR on High-Value UPI Transactions from October 15

16 Sept 2026, 8:00 am · 8h ago · 1 min read · Inc42

The National Payments Corporation of India (NPCI) will introduce a Merchant Discount Rate (MDR) on select high-value Unified Payments Interface (UPI) transactions starting October 15. Under the new framework, peer-to-merchant payments exceeding ₹2,000 will attract a 0.4% MDR, capped at ₹300 for transactions of ₹75,000 and above. The fee applies strictly to merchants and cannot be passed to consumers. P2P transfers and small merchants earning up to ₹1 Lakh monthly via QR codes remain exempt. Collected fees will be distributed among issuer banks, payment service providers, and app providers to help sustain infrastructure and cybersecurity costs.