Centre rules out UPI fee rollback

New Delhi: The Union government has ruled out any rollback of the proposed 0.4 per cent Merchant Discount Rate (MDR) on Unified Payments Interface (UPI) transactions above Rs 2,000, saying the decision has already been taken and will come into effect from October 15. “There is no question of a re-think,” a top government official said, when asked whether the Centre was considering withdrawing the proposed MDR on high-value merchant transactions.

The decision comes amid sharp criticism from Opposition parties, traders and sections of the digital payments ecosystem who dubbed the move as 'Modi Tax'. Congress leader Rahul Gandhi criticised the PM saying:

“Modiji has a completely diff concept, he's neither left or right he has decided to completely lie down straight in front of Donald Trump. He's put a tax on every single Indian person by taxing UPI and giving huge amount op money to the United States.”

The Centre has rejected the allegation that the changes were driven by foreign pressure. The Finance ministry said on Wednesday that India’s UPI policy decisions were being taken independently with the objective of creating a sustainable and inclusive digital payments ecosystem.

Government sources said the MDR framework was aimed at strengthening the UPI ecosystem, including its safety and security, while making the system financially sustainable.

The Finance ministry has also stressed that customers will not be charged for UPI payments. “MDR is a charge within the merchant payment ecosystem.

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