India will introduce a 0.4% Merchant Discount Rate (MDR) on specified UPI payments to merchants above ₹2,000, effective October 15, 2026. The charge will be paid by merchants, not consumers, and will be capped at ₹300 per transaction. Person-to-person UPI transfers will remain free, while about 96% of merchant transactions are expected to remain unaffected.
Key points:
- 💳 Above ₹2,000: 0.4% MDR for specified merchant transactions
- 🧑💻 Consumers: No UPI transaction charge
- 👥 P2P transfers: Remain free
- 🛍️ Small merchants: Eligible transactions remain exempt
- 📅 Effective: October 15, 2026
- 💰 Maximum MDR: ₹300 per transaction