INCOME TAX15 Sept 2026
NPCI releases MDR framework for UPI transactions — Here's what changes for merchant payments | Mint
NPCI has released a merchant discount rate (MDR) framework for UPI payments. Person-to-person transfers stay free at any amount. Merchant payments up to ₹2,000, plus small merchants using P2PM accounts, also stay free. Above ₹2,000, a 0.4% MDR applies, capped at ₹300 per transaction. Officials say this touches only about 4% of merchant payments. A fund equal to 5% of MDR collected will support small merchants.
Key Statutory Highlights
- UPI person-to-person payments stay completely free, no matter how much money is transferred.
- A 0.4% MDR applies on merchant UPI payments above ₹2,000, capped at ₹300 per transaction.
- Small merchants on P2PM accounts receiving up to ₹1 lakh a month through UPI QR codes keep zero MDR.
Actionable Advice for Taxpayers / Founders:Check with your bank or payment app whether your merchant account falls under the P2PM small merchant category, and confirm how any MDR on payments above ₹2,000 is being charged to you.
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
Share: