UPI Merchant Payments Over 2,000 To Cost More
Max Fee 300; Effective Oct 15
To strengthen the digital payment framework, the central government has decided to levy a 0.4% charge on commercial (merchant) UPI transactions exceeding ₹2,000, effective October 15. A maximum cap of ₹300 has been set for the fee on any single transaction.
However, providing relief to the general public, small digital payments up to ₹2,000 and transactions made via RuPay debit cards will remain completely free of charge.
P2P Personal Transfers To Remain Completely Free
The government has clarified that this charge will not apply to personal fund transfers between individuals (P2P). The fee will primarily be levied as a Merchant Discount Rate (MDR) on shopkeepers and service providers in exchange for the facility to accept digital payments.
Key Points
No Direct Impact on Consumers : Personal financial transactions will remain entirely free; the MDR on commercial payments is primarily a cost borne by the merchant.
Investment in Cybersecurity and Infrastructure : This system has been introduced to support the rapid expansion of the UPI network, curb cyber fraud, and strengthen technical infrastructure.
Political Debate : Amidst criticism from the opposition regarding the decision to charge for digital payments, the Centre has clarified that the everyday small transactions of ordinary customers will remain unaffected.
