UPI MDR 0.4% from October 15 2026 on person-to-merchant payments
Starting October 15, 2026, UPI person-to-merchant transactions will attract MDR of 0.4% for payments over ₹2,000 made to merchants.
This mainly affects small shop owners and gig workers who rely on digital payments in that range, plus, if gig workers receive over ₹1 lakh for three months straight, they might be treated as merchants too.
Retailers seek exemptions, plan protests
For transactions above ₹75,000, the fee is capped at ₹300.
Retailers and groups like AIMRA are worried the new charges could eat into already thin profits: AIMRA estimates members could lose about ₹4,000 monthly and is asking the government to step in.
Small jewelers say even lightweight jewelry sales will be hit, while ride-hailing drivers might see their earnings dip through fare adjustments.
Some groups are planning protests and want exemptions from these fees to keep their businesses afloat.