The Finance Ministry denies rumors of MDR charges on UPI transactions above Rs 3,000, reaffirming support for digital payments. Learn more about UPI’s growth and why there’s no MDR on UPI.
The Unified Payments Interface (UPI) has made paying for things online super easy in India. Recently, some news suggested the government might add a fee called the Merchant Discount Rate (MDR) on UPI payments above Rs 3,000 to help banks and payment apps. But the Finance Ministry has said these claims are not true. They want everyone to know that UPI will stay free and they fully support digital payments.
What Did the Government Say?
The Finance Ministry posted on X (previously Twitter) to clear up the confusion. They said:
“Talk about adding MDR to UPI payments is completely false and misleading. These rumors create unnecessary worry among people. The government is committed to making digital payments like UPI easy and free for everyone.”
This means you don’t have to worry about extra charges when using UPI!
How Popular Is UPI in India?
UPI is a big deal in India! According to the National Payments Corporation of India (NPCI):
- On June 10, 2025, people made 634.29 million UPI transactions in a single day, moving Rs 91,838.53 crore.
- In just the first 10 days of June 2025, there were 6,346.42 million transactions, totaling Rs 8,98,111.14 crore.
That’s a huge amount of money being sent through UPI!
Why UPI Is So Loved
UPI started 10 years ago and now handles 80% of all digital retail payments in India. Since 2020, person-to-merchant (P2M) UPI transactions have reached a massive 60 lakh crore. It’s fast, easy, and trusted by millions.
No MDR on UPI Transactions
Right now, there’s no MDR fee for person-to-merchant UPI payments. This rule has been in place since January 2020, thanks to the Central Board of Direct Taxes (CBDT). So, when you pay a shop or a merchant using UPI, it’s completely free for them.
What About Other Payment Methods?
While UPI has no MDR, credit and debit cards do have fees, ranging from 0.9% to 2%. However, RuPay cards don’t have this fee. The Payments Council of India (PCI) suggested a small 0.3% MDR for big merchants, but nothing has been decided yet.
Why This Matters
The Finance Ministry’s statement is great news for everyone who loves using UPI. It means you can keep paying for things like groceries, bills, or online shopping without worrying about extra charges. UPI’s growth shows how much India trusts digital payments, and the government wants to keep it that way.
Conclusion
UPI is here to stay, and it’s free from MDR charges! The Finance Ministry has made it clear that rumors about new fees are false. With billions of transactions happening every month, UPI is changing how we pay for things in India. Keep using UPI and enjoy the ease of digital payments!