Will individual users pay for UPI transactions?

No, individuals making UPI transactions to other persons will not incur any charges.

Why is MDR introduced for merchant payments?

The MDR is introduced to regulate charges on merchant payments and support payment service providers.

India 1 MIN READ

UPI Remains Free for Person-to-Person Payments, MDR Charged on Merchants

Merchant transactions above ₹2,000 will incur 0.4% MDR, says expert

Unified Payments Interface (UPI) will continue to be free for person-to-person payments, while a 0.4% merchant discount rate (MDR) will apply to merchant transactions exceeding ₹2,000. An expert explained the new charges and their impact on digital payments.

Reported by: निहारिका टाइम्स न्यूज़ डेस्क

Published Sep 15, 2026

News Desk, Niharika Times

AI Summary

UPI will remain free for person-to-person payments, while a 0.4% merchant discount rate (MDR) will be applied to merchant transactions above ₹2,000. The MDR aims to regulate charges on merchant payments without affecting small transactions or individual users. This measure is intended to balance interests between payment providers and merchants and promote digital payment use.

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The expert clarified that individual users will not be charged for UPI transactions made to other persons. However, merchants processing payments above ₹2,000 through UPI will be subject to a 0.4% MDR. This move aims to regulate charges on merchant payments while keeping person-to-person transactions free.

The expert also mentioned that the MDR will apply only to transactions exceeding ₹2,000, ensuring small payments remain unaffected. This step is expected to balance the interests of payment service providers and merchants, while encouraging digital payment adoption among consumers.

अक्सर पूछे जाने वाले सवाल

Will individual users pay for UPI transactions?: No, individuals making UPI transactions to other persons will not incur any charges.
Why is MDR introduced for merchant payments?: The MDR is introduced to regulate charges on merchant payments and support payment service providers.

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UPI Remains Free for Person-to-Person Payments, MDR Charged on Merchants

Merchant transactions above ₹2,000 will incur 0.4% MDR, says expert

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