GENERAL16 Sept 2026
UPI fee: Why government is putting a price on big merchant payments
From October 15, big UPI payments will cost merchants a little more. A 0.4 per cent Merchant Discount Rate, or MDR, now applies to person-to-merchant UPI payments above ₹2,000. You pay this, not your customer, and it is capped at ₹300 once a transaction reaches ₹75,000. Personal transfers and most everyday payments stay free. NPCI says the money will fund security and better service.
Key Statutory Highlights
- From October 15, a 0.4 per cent MDR will apply to person-to-merchant UPI payments above ₹2,000.
- The charge is paid by merchants, not consumers, and is capped at ₹300 for transactions of ₹75,000 or more.
- Payments between individuals, and the vast majority of everyday merchant payments, will remain free.
Actionable Advice for Taxpayers / Founders:If your business accepts large UPI payments, review your billing and pricing setup before October 15 so this 0.4 per cent merchant charge is accounted for correctly, and confirm how it will be collected with your payment provider or CA.
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: