The National Payments Corporation of India (NPCI) has unveiled the MDR framework for UPI transactions, detailing how charges will apply as the platform grows while prioritising inclusivity and sustainability.
Key free thresholds under the policy
- UPI remains free for all person-to-person transfers.
- Merchant payments up to ₹2,000 will also stay free.
- Small merchants are covered under zero MDR as defined by the framework.
What changes for larger merchants and other scenarios
- Beyond the free thresholds, MDR charges may apply in a tiered structure designed to support system sustainability and ongoing development.
- NPCI emphasises the framework aims to promote broader digital payments adoption while preserving UPI’s long-term viability.
The move signals a balance between encouraging digital payments and ensuring the UPI ecosystem can scale with rising volumes and merchant participation.
