Wire · operational-macro
6 Years On, Govt Sets 0.4% Fee On UPI Merchant Payments Above Rs 2000; Capped At Rs 300
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Fusion42 · 15 September 2026 · Fusion42 review
The Indian government has introduced a 0.4% merchant discount rate (MDR) fee on UPI transactions above Rs 2,000, capped at Rs 300, while exempting small-value and person-to-person transfers. The move aims to share payment system costs among merchants without affecting everyday users and protects small merchants and critical sectors with flat or no fees.
This Wire brief sits within Fusion42's coverage of Fintech, and 2 sources have reported it.
◆ ◆ The Wire takeaway
UPI merchants now pay fees on larger transactions, which opens a new revenue channel for banks and payment apps but threatens those reliant on free payment flows. You must rethink merchant cost models and explore opportunities to offer value-added payment services to offset these new charges.
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2 sources · 15 Sep 2026
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