Customers will never pay, only merchants: PhonePe CEO
In Short
The PhonePe CEO clarified that customers will continue to use UPI without any charges, while small merchants with an annual turnover of less than Rs 1 lakh will also remain outside the MDR regime
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PhonePe CEO Sameer Nigam
New Delhi: The new Merchant Discount Rate (MDR) framework for UPI transactions will not impose any charges on customers and the move is necessary to make India's digital payments ecosystem financially sustainable, PhonePe CEO Sameer Nigam said on Wednesday.
The PhonePe CEO clarified that customers will continue to use UPI without any charges, while small merchants with an annual turnover of less than Rs 1 lakh will also remain outside the MDR regime. "No, there are no fees for customers on UPI at all. Customers have never been charged for using UPI, nor will they be charged in the future," Nigam said.
For larger shops, 96 per cent of the transactions, which are all below Rs 2,000, there will be no charge, according to him. He added that merchants, and not customers, would pay a 0.4 per cent MDR on transactions above Rs 2,000. He said the revenue generated through MDR would help fund investments by companies and banks that form the UPI ecosystem.
