Story perspectives

Merchants Face 0.4% UPI Fee Above INR2,000 From Oct 15

By Drooid · Sep 20, 2026, 4:05 AM UTC · How we work

Summary

Story summary

Indian government and National Payments Corporation of India (NPCI) set a 0.4 % MDR on UPI transactions above INR2,000 from 15 Oct 2026.
Merchants, not customers, will bear the fee to keep the UPI ecosystem financially self-sustaining.
Petrol-pump associations in Ghaziabad and Madhya Pradesh will refuse UPI payments above INR2,000 after the October deadline.
A public-interest litigation challenges the new MDR framework’s constitutional validity in the Supreme Court.

History

Historical Context

The National Payments Corporation of India, created in 2009, launched the Unified Payments Interface on 11 April 2016 under RBI Governor Raghuram Rajan, quickly scaling to over 10 billion transactions by 2022. In October 2026 the government set a 0.4 % merchant-discount rate on UPI payments above INR2,000, prompting merchant groups to refuse and sparking a Supreme Court challenge that could reshape fee rules.

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Story summary

Indian government and National Payments Corporation of India (NPCI) set a 0.4 % MDR on UPI transactions above INR2,000 from 15 Oct 2026.
Merchants, not customers, will bear the fee to keep the UPI ecosystem financially self-sustaining.
Petrol-pump associations in Ghaziabad and Madhya Pradesh will refuse UPI payments above INR2,000 after the October deadline.
A public-interest litigation challenges the new MDR framework’s constitutional validity in the Supreme Court.

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