'No UPI Day' withdrawn after traders meet FM Sitharaman over proposed MDR

Trader associations have withdrawn their call for a "No UPI Day" on October 2 after meeting Finance Minister Nirmala Sitharaman on Wednesday to discuss the proposed merchant discount rate (MDR) on UPI payments.

The move came after a delegation of about 20 senior business leaders met Sitharaman to raise concerns over the proposed fee and its impact on traders and small businesses.

The proposed 0.4% fee on merchant payments above Rs 2,000 is still scheduled to take effect from October 15.

CAIT National General Secretary and Chandni Chowk MP P Khandelwal led the delegation, which included representatives of several business organisations.

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Khandelwal said the decision to withdraw the protest followed "constructive discussions" with the government. "In view of the constructive discussions and the assurance that the concerns raised by the trading community will receive due consideration," the organisations decided to withdraw the call, he said.

The trade bodies urged the government to defer the proposed MDR in view of the upcoming festive season and increased business activity. They also sought a review of the Rs 1 lakh threshold under the proposed framework, asking the government to consider raising it to Rs 5 lakh.

The associations further asked that merchant-to-merchant transactions be kept outside the MDR framework. They also called for a special committee to examine their concerns and recommend a way forward.

'Committed to digital payments'

The delegation raised concerns about the potential impact of the proposed MDR on traders, particularly small and medium businesses. It also stressed the need to maintain the momentum of digital payments without adding financial burdens on merchants.

The Finance Minister assured the representatives that the government remained committed to promoting digital transactions while safeguarding the interests of all stakeholders, CAIT said.

"CAIT is fully committed to the success of digital payments and UPI," the traders' body said. "Our objective is to ensure that, while further strengthening the digital payment system, policies remain practical and balanced for traders, MSMEs, and the entire digital business ecosystem."