INCOME TAX27 Sept 2026
UPI MDR row reaches SC: Plea against merchant charges on payments above ₹2,000 to be heard on Monday | Mint
The Supreme Court will hear a plea on Monday against the new merchant discount rate (MDR) on UPI (Unified Payments Interface) payments above ₹2,000. From October 15, a 0.4% charge applies to person-to-merchant transfers, while person-to-person and small merchant payments stay free. The petition questions the rules and flags concerns for low-margin merchants. Banks must ensure merchants don't pass this charge to you.
Key Statutory Highlights
- A 0.4% merchant discount rate will apply to person-to-merchant UPI payments above ₹2,000 from October 15.
- Person-to-person UPI transfers and small merchant payments will continue to remain free of any charge.
- The public interest litigation challenges the amended Section 10A of the Payment and Settlement Systems Act, 2007, saying the levy was brought in without adequate safeguards, transparency or public consultation.
Actionable Advice for Taxpayers / Founders:Keep an eye on Monday's Supreme Court hearing and check your payment provider's updates around October 15. If an MDR charge is passed on to you as a customer, ask your bank or payment provider to clarify, since banks have been told merchants must not pass it on.
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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