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Mumbai : The Reserve Bank of India stated on Tuesday that implementing a 0.4 percent charge (MDR) on UPI transactions exceeding ₹2,000 is a significant step towards the long-term sustainability of India’s digital payment ecosystem.
The central bank noted that this measure would assist UPI in expanding, innovating, and providing services to customers and businesses across the country.
In a post on ‘X’, the Reserve Bank stated that a fair and appropriate distribution of MDR within the ecosystem would encourage continuous investment in technology, infrastructure, and acceptance mechanisms.
This could help UPI achieve wider acceptance, grow its customer base, and drive a steady increase in transaction volumes.
Significantly, all UPI transactions (person-to-person and person-to-merchant) will remain free for users, and person-to-merchant transactions below ₹2,000 will continue to be free for merchants as well.
The central bank assured, “The Reserve Bank is committed to ensuring that UPI remains secure, seamless, affordable, and accessible, while also fostering the long-term sustainability and growth of India’s world-class digital payment ecosystem.”
It is noteworthy that UPI is operated by the National Payments Corporation of India (NPCI), an initiative of the Reserve Bank and the Indian Banks’ Association. It facilitates real-time payments between individuals and enables customers to make direct payments to merchants while shopping.
Report – Abhijit Tushar Bhatt (Political Editor)
Mudasir Maqbool
