‘Not a government issue’: FM Sitharaman explains where UPI MDR charge goes
Times of India 1 hr ago·25 Sept 2026, 7:07 am
Finance Minister Nirmala Sitharaman clarified that the government is not charging any Merchant Discount Rate (MDR) on UPI transactions. She explained that for payments exceeding Rs 2,000, the cost is absorbed by merchants and banks, not the consumer. This policy ensures that digital payments remain free for users, maintaining the competitive advantage of the UPI system.
This move is significant for the broader financial ecosystem as it protects the volume of digital transactions. By shielding consumers from fees, the government encourages continued adoption of digital payments, which benefits the entire market. It reinforces the stability of the digital payment infrastructure.
Investors should watch for the long-term impact on digital payment volumes and the competitive dynamics between different payment platforms. The continued growth of the digital payments sector remains a key trend to monitor.
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