INCOME TAX15 Sept 2026
Government clarifies credit card-linked UPI payments exempt from 0.4% fee | Mint
The government has clarified that credit card-linked UPI payments will not attract the new 0.4% Merchant Discount Rate (MDR) fee from October 15. The charge applies only to direct bank-account-to-merchant-account UPI payments above ₹2,000, capped at ₹300 per transaction. Credit lines linked to UPI stay outside this fee too. So if you pay merchants straight from your bank account, check your statements after mid-October.
Key Statutory Highlights
- From October 15, a 0.4% Merchant Discount Rate applies to direct bank-account-to-merchant-account UPI payments above ₹2,000, capped at ₹300 per transaction.
- Credit card-linked UPI payments and pre-sanctioned bank credit lines will not come under the new 0.4% MDR regime.
- Capital-market UPI payments such as mutual funds, securities and stock brokers attract a lower 0.02% MDR, also capped at ₹300 per transaction.
Actionable Advice for Taxpayers / Founders:If you accept UPI payments in your business, review your payment flows before October 15 and check with your bank or CA about which of your transactions may attract the new MDR.
Statutory Disclaimer: TaxQue Shorts are AI-assisted editorial briefs for compliance awareness. This brief has not passed every source check; confirm the original notification before acting. This does not constitute formal legal or CA counsel.
TaxQue News Desk
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