Reserve Bank of India announced a 0.4% merchant discount rate on UPI person‑to‑merchant transactions exceeding ₹2,000, starting October 15. The fee is capped at ₹300 for payments of ₹75,000 and above, while person‑to‑person transfers remain free.
In FY26, UPI handled 24,162 crore transactions, 63% of which were P2M. Only 4% of those exceeded the ₹2,000 threshold, yet they account for roughly 66% of the total value of all P2M payments.
RBI Chair Shaktikanta Das said the levy will help fund the network’s expanding infrastructure, fraud‑prevention, and security needs, ensuring long‑term sustainability.
Small‑scale shop owner Rajesh Kumar from Jaipur told reporters that the new fee will add a few rupees to each high‑value sale but is acceptable if it keeps the payment system running.
UPI service providers must modify their billing engines by mid‑October, and merchants are advised to review their pricing strategies to absorb the additional cost.