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Parliament Passes Bill Ending UPI Merchant Discount Rate Ban

8/17/2026

Summary

Story summary

Parliament passed the Taxation and Other Laws (Amendment) Bill, 2026, removing the ban on merchant discount rates for UPI transactions.
Finance Minister Nirmala Sitharaman said the change will not add taxes or fees for ordinary UPI users, keeping person-to-person transfers free.
A parliamentary committee noted subsidies cover only 11 percent of the payment industry’s costs, while UPI processed over 241 billion payments worth USD 3.3 trillion for 555 million users last fiscal year.

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Story summary

Parliament passed the Taxation and Other Laws (Amendment) Bill, 2026, removing the ban on merchant discount rates for UPI transactions.
Finance Minister Nirmala Sitharaman said the change will not add taxes or fees for ordinary UPI users, keeping person-to-person transfers free.
A parliamentary committee noted subsidies cover only 11 percent of the payment industry’s costs, while UPI processed over 241 billion payments worth USD 3.3 trillion for 555 million users last fiscal year.