NPCI likely to defer UPI MDR rollout, announcement expected on Friday: Report
On September 15, the government announced the 0.4% MDR on UPI merchant transactions above Rs 2,000, with implementation initially scheduled for October 15
- Oct 8, 2026,
- Updated Oct 8, 2026 10:27 PM IST
The National Payments Corporation of India (NPCI) is likely to postpone the implementation of the Unified Payments Interface (UPI) merchant discount rate (MDR), Moneycontrol reported on Thursday, citing sources.
The UPI Steering Committee has been called to meet on Friday (October 9) to decide on the deferment of the MDR, according to the report. The committee is expected to meet in the first half of the day, with an announcement likely around 1-2 pm.
The development comes after merchant bodies, fintech companies and payments firms asked NPCI to postpone the implementation. They have raised concerns about consumer sentiment during festival sales and varying MDR rates.
On September 15, the government announced the 0.4% Merchant Discount Rate (MDR) on UPI merchant transactions above Rs 2,000, with implementation initially scheduled for October 15.
The move quickly drew criticism from traders and merchant associations, which urged the government to roll it back. Their concern was that even a small charge on every UPI payment above Rs 2,000 could add up for businesses working on thin margins.
Trade bodies warned that some shopkeepers could stop accepting UPI for larger purchases, ask customers to pay in cash or eventually pass the extra cost on to buyers. They also questioned why merchants should be charged for using UPI after years of being encouraged to adopt digital payments.
Trade associations have also argued that the charge would eat into already thin profit margins, particularly for small retailers, distributors and businesses handling high-value transactions.
They fear merchants could stop accepting UPI for larger purchases, encourage cash payments or indirectly pass the additional cost to customers.
The Chamber of Trade and Industry (CTI), which has urged Finance Minister Nirmala Sitharaman to withdraw the levy, estimates that transactions above Rs 2,000 could fall by as much as 50%.
Traders have also argued that businesses should not be penalised for adopting digital payments after years of government efforts to promote a cashless economy..
The National Payments Corporation of India (NPCI) is likely to postpone the implementation of the Unified Payments Interface (UPI) merchant discount rate (MDR), Moneycontrol reported on Thursday, citing sources.
The UPI Steering Committee has been called to meet on Friday (October 9) to decide on the deferment of the MDR, according to the report. The committee is expected to meet in the first half of the day, with an announcement likely around 1-2 pm.
The development comes after merchant bodies, fintech companies and payments firms asked NPCI to postpone the implementation. They have raised concerns about consumer sentiment during festival sales and varying MDR rates.
On September 15, the government announced the 0.4% Merchant Discount Rate (MDR) on UPI merchant transactions above Rs 2,000, with implementation initially scheduled for October 15.
The move quickly drew criticism from traders and merchant associations, which urged the government to roll it back. Their concern was that even a small charge on every UPI payment above Rs 2,000 could add up for businesses working on thin margins.
Trade bodies warned that some shopkeepers could stop accepting UPI for larger purchases, ask customers to pay in cash or eventually pass the extra cost on to buyers. They also questioned why merchants should be charged for using UPI after years of being encouraged to adopt digital payments.
Trade associations have also argued that the charge would eat into already thin profit margins, particularly for small retailers, distributors and businesses handling high-value transactions.
They fear merchants could stop accepting UPI for larger purchases, encourage cash payments or indirectly pass the additional cost to customers.
The Chamber of Trade and Industry (CTI), which has urged Finance Minister Nirmala Sitharaman to withdraw the levy, estimates that transactions above Rs 2,000 could fall by as much as 50%.
Traders have also argued that businesses should not be penalised for adopting digital payments after years of government efforts to promote a cashless economy..