The reason for this is that the National Payments Corporation of India (NPCI) provides facilities to them. However, there is a discussion on imposing fees on big merchants while keeping the transactions free for small businesses.

The central government is making big preparations regarding UPI. The government is preparing to re-implement MDR charge on UPI. This charge is being prepared to be imposed not only on UPI but also on RuPay debit cards. If this happens, digital payments may be affected. This charge was waived by the government in the year 2022. But, now fintech companies say that big merchants have the ability to bear it. Therefore, Merchant Discount Rate (MDR) should be charged on such merchants.

Let us tell you that UPI transactions are increasing rapidly. Therefore, the government wants that big traders should also bear some of its expenses. In the budget for the year 2025-26, the government has reduced the payment subsidy from Rs 3,500 crore to Rs 437 crore. Due to which banks are incurring losses. Before the year 2022, merchants had to pay some fees. Which is called Merchant Discount Rate (MDR). This fee was given to the bank in exchange for doing the transaction.

Big businesses may face a setback

According to media reports, bankers say that a banker told that banks have given a proposal to the government. It has been suggested that MDR should be applied to those merchants. Whose annual GST turnover is more than 40 lakh rupees. The government is also planning to start a tiered pricing system. Under this system, big merchants will have to pay higher charges. On the other hand, small merchants will have to pay less fees. A proposal to impose MDR on UPI payments has been sent to the central government by industry banks. Now the department is considering this matter. If this happens, then MDR will return once again.

Know what is MDR?

In the digital payment industry, Merchant Discount Rate (MDR) is the amount that a merchant or shopkeeper has to pay for the real-time payment made by the customer. Currently, there is no MDR applicable on UPI and RuPay debit card payments. These payments are made easy through the National Payments Corporation of India (NPCI). But now the government is preparing to impose merchant charges on these transactions as well.

1,611 crore UPI transactions took place in February

Let us tell you that in February 2025, 1611 crore transactions were done through Unified Payment Interface (UPI). During this period, a total amount of Rs 21.96 lakh crore was transferred. The number of transactions has increased by 33 percent on an annual basis.

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The post Central govt is Considering Imposing Merchant Charges on UPI and RuPay transactions first appeared on Rightsofemployees.com.

Transactions through UPI and RuPay debit cards may soon be charged. This means that using UPI will no longer be free, you may have to pay extra for it.

In fact, according to a media report, the government is evaluating a proposal to bring back merchant charges on transactions made through Unified Payments Interface (UPI) and RuPay debit cards. If this happens, then digital payments will become expensive.

The post UPI Transaction Charge: Government is preparing to impose merchant charges on UPI and RuPay transactions first appeared on Rightsofemployees.com.