STARTUP LEGAL22 Sept 2026
UPI MDR to pinch retailers with bigger baskets, while sparing others | Company Business News
From 15 October, UPI payments above ₹2,000 to merchants will carry a proposed 0.4% merchant discount rate (MDR), a charge the merchant pays. Transactions up to ₹2,000 and person-to-person transfers stay free, and the fee is capped at ₹300 above ₹75,000. Jewellers, electronics, fashion and firms like Nykaa and Lenskart face margin pressure. Check your average order value and reprice if needed.
Key Statutory Highlights
- A proposed 0.4% merchant discount rate will apply to person-to-merchant UPI transactions above ₹2,000 from 15 October, and the charge is to be borne by merchants.
- Payments up to ₹2,000 and person-to-person UPI transactions remain free, while the MDR on transactions of ₹75,000 and above is capped at ₹300.
- Retailers with larger baskets face margin pressure, while food delivery and quick-commerce businesses with lower per-customer order values are likely to be less affected.
Actionable Advice for Taxpayers / Founders:Review your average order value and how much of your UPI collection sits above ₹2,000, so you know whether this cost touches you. Before changing prices or payment options, confirm the final scope and rate through the official notification or with your 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: