Merchant Discount Rate on UPI transactions deferred to after Diwali

A 0.4% MDR was to be levied on Person-to-Merchant UPI payments above Rs 2,000 from 15 October. A new date for implementation will be announced after Diwali.

MDR deferred until after Diwali| Representational image | Agencies

New Delhi: In a major relief to UPI users, the decision to levy a Merchant Discount Rate of 0.4 per cent on transactions over Rs 2,000 has been deferred, with NPCI on Tuesday saying a new date for the implementation will be decided after Diwali.

According to the National Payments Corporation of India (NPCI) circular issued last month, a 0.4 per cent MDR was to be levied on Person-to-Merchant UPI payments above Rs 2,000 from October 15.

“UPI and Services Steering Committee today decided that, keeping in mind the festive season, Merchant Discount Rate (MDR) on select Person-to-Merchant (P2M) UPI transactions shall be implemented immediately post Diwali on a date to be notified separately,” NPCI said in a statement on Tuesday.

The MDR has to be paid by merchants, not consumers and capped at Rs 300 for transactions of Rs 75,000 or more.

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