NPCI defers MDR charges rollout until after Diwali, delaying the planned introduction of merchant discount rate charges on certain digital payment transactions.
The National Payments Corporation of India (NPCI) has postponed the rollout, with the revised implementation dates to be announced later.
Why NPCI Deferred MDR Charges
The decision means merchants and payment service providers will have to wait for further clarification on when the proposed charges will take effect.
The delay also gives businesses more time to understand the revised timeline and prepare for the changes.
MDR, or merchant discount rate, is a fee associated with processing certain digital payments.
Depending on the payment method and applicable rules, the charge may affect how transaction-processing costs are handled between merchants, banks and payment service providers.
Which UPI Transactions May Attract MDR Charges?
Under the proposed framework, a 0.4% MDR is planned for specified person-to-merchant UPI transactions above ₹2,000, subject to applicable caps and exemptions.
The framework was originally scheduled to take effect from October 15, 2026.
The proposed fee is payable by merchants and is intended to support participants involved in processing digital payments.
Person-to-person transfers and eligible transactions protected under the existing zero-MDR framework are not covered by the same charges.
Will Customers Have to Pay More for UPI?
The postponement means the proposed MDR rollout will not begin on the original October 15 date.
However, the final implementation date is yet to be announced, and merchants should wait for official clarification on the applicable rules.
Customers can continue using UPI for everyday payments while keeping in mind that the proposed framework concerns selected merchant transactions, not every UPI transfer.
The exact impact will depend on the final rules and the types of transactions covered.
