INCOME TAX3 Oct 2026
UPI MDR Charges: Start date, slabs and why is this Merchant Discount Rate being introduced now? All questions answered | Mint
From 15 October 2026, UPI person-to-merchant payments above ₹2,000 will carry a Merchant Discount Rate (MDR) fee. Person-to-person transfers stay free, and small merchants getting up to ₹1 lakh monthly through UPI QR codes also pay nothing. Since transactions under ₹2,000 cover over 95% of such payments, most businesses won't notice. Check whether your larger online collections now attract MDR.
Key Statutory Highlights
- MDR will apply to person-to-merchant UPI transactions above ₹2,000 with effect from 15 October 2026, as per the NPCI.
- All person-to-person UPI transactions remain free, so customers pay no MDR charge.
- Small merchants, including street vendors, receiving up to ₹1 lakh a month under the Person-to-Person-Merchant category continue to enjoy zero MDR.
Actionable Advice for Taxpayers / Founders:It would be wise to review your monthly UPI collections and, if you receive many person-to-merchant payments above ₹2,000, ask your bank or payment provider how the MDR will apply to you before it takes effect.
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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