An important update has emerged for customers and merchants making large payments through UPI. The new MDR (UPI MDR Charges) charge on UPI transactions of more than Rs 2,000 can now be implemented from January 1, 2027 instead of October 15. According to sources, consideration is being given to extending the date of implementation of this new rule, the main objective of which is to give some more time to the shopkeepers and the payment ecosystem to be completely prepared.
Festive season and new rules framework
During the festive season, people shop extensively and there is a huge increase in digital payments. In such a situation, there may be problems due to implementation of any new rule, keeping this in mind this decision is being taken. However, there will be no change in the basic structure of the MDR rules already announced by the government.
What is the new MDR rule?
Under the new proposed rules, if a customer makes a UPI payment of more than Rs 2,000 to a merchant (P2M), he may be charged an MDR charge of 0.4 percent. If the transaction is of Rs 75,000 or more, then this charge has been fixed at a maximum of Rs 300 only. It is a matter of relief that there will be no charge on general transactions (P2P) between small shopkeepers and common people and it will remain completely free as before.
Legal process and other updates in Supreme Court
This new rule has come at a time when the matter related to it is also in the court. Recently, the Supreme Court had refused to stay the Central Government’s decision to impose MDR on merchant transactions, although the court has issued a notice to the Central Government, RBI and NPCI on this matter. Apart from this, talks are also going on between the payment aggregator and sponsor banks regarding MDR commission. RBI Governor Sanjay Malhotra has recently clarified that these new rules will not have any major negative impact on the number of transactions.
