The government announced a 0.4 per cent Merchant Discount Rate (MDR) on UPI payments above ₹2,000 made to merchants.
The finalized MDR framework and threshold structure will take effect from October 15, 2026, for the updating for software and billing systems.
0.4% MDR On UPI Transactions: What Is Merchant Discount Rate And How Will It Affect Payments?
As per the new rules, Person-to-Merchant (P2M) UPI payments above ₹2,000 will attract a 0.4 per cent Merchant Discount Rate (MDR).
The National Payments Corporation of India (NPCI) announced a new Merchant Discount Rate (MDR) structure for UPI transactions, granting a zero‑MDR to person‑to‑person merchant (P2PM) users. Transactions above Rs 2,000 for other merchants will be levied a 0.4% charge.
