New Delhi The decision to implement Merchant Discount Rate (MDR) on UPI transactions has been postponed till after the upcoming Diwali festival. The government has taken this important step keeping in mind the upcoming festive season. Merchants across the country have been demanding from the government for a long time that the decision to impose any additional charges on UPI payments should be postponed for the time being. This new rule was going to come into effect from October 15.
NPCI gave official information through social media
National Payments Corporation of India (NPCI), while sharing information in this regard on its official social media platform ‘X’ (formerly Twitter), has said that the decision to implement MDR on select merchant transactions has been put on hold till after Diwali. This simply means that the MDR charge on UPI payments above Rs 2,000, which was to come into effect from October 15, 2026, has been postponed. This step of the government and NPCI is expected to provide great relief to traders and shopkeepers across the country.
MDR charge was to be imposed on payment of more than Rs 2,000
According to the proposed system, there was a provision to levy a charge of up to 0.4 percent on some selected merchants for payment of more than Rs 2,000 through UPI. This meant that if a customer purchased goods worth more than Rs 2,000 from a shop, a charge would be applicable on it, but this charge was not to be borne by the customer but directly by the shopkeeper i.e. the merchant. For example, if a customer purchased an item worth Rs 4,000, he had to pay only Rs 4,000, while the additional charges on it were to be paid by the concerned shopkeeper. Now the postponement of this decision will provide convenience to both customers and traders during the festive season.
