Payments Council Rules Out Consumer MDR; PhonePe & Razorpay Back Free UPI
The Payments Council of India confirmed that UPI payments will remain free for consumers, despite government plans to introduce merchant discount rates (MDR) on certain transactions. This decision comes amid ongoing discussions about sustainable funding for India's digital payments ecosystem, with support from companies like PhonePe and Razorpay for a merchant-only MDR framework. The government is expected to impose an MDR of 0.25% to 0.4% on business UPI transactions exceeding ₹2,000, while ensuring that consumer payments remain exempt.