Why Fintech Earn More From UPI MDR Charges? | Paytm | Mobiwik | Pine Labs

The proposed UPI Merchant Discount Rate could create a new revenue stream for fintech and payment ecosystem players. Sameer Dalal, President, Natverlal & Sons Stockbrokers explains why the 0.4% MDR on specified UPI merchant transactions above ₹2,000 could benefit companies, even though the fee will be shared across banks, payment firms and NPCI. Since the payment infrastructure is already in place, the additional revenue could flow directly to profitability, with little incremental cost involved. However, he also highlights a key concern around the future of the MDR threshold. If a fee is introduced above ₹2,000, could that limit eventually be lowered? Here’s what the UPI MDR rollout could mean for fintech revenues, profitability and the wider digital payments ecosystem.