Government to charge 0.4% MDR on merchant UPI over ₹2,000
Business
Starting October 15, 2026, the government will charge a 0.4% fee (called MDR) on UPI payments over ₹2,000, but only for merchants.
Regular users can keep making personal UPI payments for free, just like before.
Government defends fee, promises rural support
Officials say the fee helps keep UPI running smoothly and covers costs that were piling up under the old zero-fee policy (which cost the government about ₹2,000 crore a year).
While some traders and political parties are calling it a "Modi Tax," the government insists it's needed for long-term sustainability and promises extra support to help expand UPI in rural areas.