UPI Payment: There is an important news for those making digital payments. The government is now considering charging a UPI transaction of Rs 3,000 or more. The government can impose MDR i.e. merchant discount rate. Till now, neither the customer has to pay any charge nor any fees are charged from the traders. This is called Zero MDR Policy. But now this system can turn on UPI payment of Rs 3,000 or above.
What is MDR fees?
MDR is actually a fee that banks or payment app companies collect from traders, when a customer pays from UPI to them. The government is currently thinking of levying such charge on only more than 3,000 transactions. This means that common people who make small shopping everyday with UPI, such as vegetables, grocery, milk or online food, will have no effect on them.
Why is the government considering putting MDR?
The objective of this proposal is that banks and UPI payment companies can get a permanent income. So that he can run this service for a long time without loss. Payment Council of India has already recommended the government to abolish the Zero MDR policy. The need for this change is also being felt because the use of UPI is increasing tremendously in India.
644 million (64.4 crore) UPI transactions took place on 1 June 2025.
On 2 June 2025, the figure reached 650 million (65 crore).
These figures are an indication that UPI is now ready to overtake international payment companies, such as VISA. For example, the average transaction of Visa is estimated to be around 639 million. In May 2025, India had a total of more than 14 billion (1,400 crore) UPI transactions, with a total value of more than Rs 20 lakh crore.
The government says that if a little MDR is taken on large transactions, it can further strengthen the digital payment system and will help banks in its operation. Currently, this proposal is under initial discussion, and the government will interact with traders and payment companies before implementing it. But it is certain that for the common people, small payments from UPI will be free as before.
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