UPIQRTool

UPI policy explainer

UPI Charges and MDR:
What Applies to You?

Article published:
Content last updated:
Content last verified: Verification date not yet recorded — owner review pending.

Who is affected?

Person to person (P2P)
The Ministry says transfers between individuals remain free, regardless of amount. [S4]
Bank account → merchant (P2M)
The announced MDR concerns select merchant acceptance, not the customer making the payment. Rollout was postponed. [S1] [S3]
Eligible small merchants (P2PM)
The published framework retains zero MDR for qualifying small merchants. Eligibility depends on the acquiring bank’s classification; ask your provider rather than inferring it from a QR. [S2]
Wallet / prepaid instrument (PPI)
A different funding method. NPCI’s 2023 clarification separates PPI merchant interchange from bank-account UPI. It is historical background, not a current wallet rate schedule. [S5]
Credit-linked UPI
RuPay credit cards and bank credit lines follow separate credit-product rules. This page does not quote their rates or borrowing costs. [S2]

Announced framework — rollout deferred

The September announcement described MDR for specified merchant payments above ₹2,000, with exemptions and category-specific treatment. These are announced terms, not evidence of implementation today. [S1]

We do not publish a “today’s rates” table or calculate a fee. The FAQ’s original 15 October 2026 start date was changed by the later 13 October postponement notice. A newer official date has not been verified in this review. [S2] [S3]

Reported Supreme Court developments

LiveLaw (5 November 2026) and ThePrint (6 November 2026) report that NPCI filed a counter-affidavit in Anjan Datta v. Union of India before the Supreme Court. According to the reports, NPCI argues that merchant MDR supports the UPI ecosystem and that merchants cannot pass it on to customers. These are NPCI’s submissions, not a court ruling. [R1] [R2]

We have not independently reviewed the original affidavit or current court docket. No filing date, next hearing date or final outcome is asserted here. Court reporting does not establish that the announced framework is in effect or cancelled.

NPCI’s 13 October notice remains the latest official implementation notice cited here: rollout after Diwali, with a date to be notified separately. Our checks have not verified a newer exact start date; this does not establish that no later notice exists. Confirm current terms with your bank or payment provider. [S3]

MDR, interchange and consumer fees

Merchant discount rate (MDR) is a merchant payment-acceptance charge. The Ministry says it is not a government tax and not a charge on the paying customer. [S1]

Interchange concerns charges between payment-system participants. NPCI’s historical PPI clarification does not make it a blanket fee on every UPI user. [S5]

A consumer fee would be a charge to the person paying. Keep that separate from merchant settlement costs and any credit-product borrowing terms. [S4] [S2]

Does my existing QR need to change?

The NPCI FAQ, Q25, says existing QR infrastructure can continue; merchants do not need to replace or re-register it just for this framework. [S2]

UPIQRTool encodes a UPI ID into a payment request. It does not enrol a merchant, determine MDR eligibility, process settlement or make a payment exempt. Changing a logo or generating a new QR cannot change your bank’s classification.

What should I do?

If you are paying

Review the recipient and amount in your own payment app. If an unexpected fee appears, ask the bank or app to explain the funding method and charge before you authorise.

If you accept payments

Ask your acquiring bank or PSP to confirm your merchant category, any exemption, settlement charges and the applicable official start notice. Keep the written terms. Check actual settlement statements; a successful QR scan does not confirm receipt.

Create a business UPI QR →

Common questions

Will I pay MDR when I make a normal bank-account UPI payment?

The Ministry of Finance distinguishes consumer payments from merchant MDR: consumers are not the party charged MDR. Do not treat a merchant fee as a fee on every person paying by UPI. [S1]

Does crossing ₹2,000 automatically mean I pay a fee?

No. This threshold belongs to the announced select-merchant framework. It is not a blanket consumer charging threshold, and the rollout was postponed. [S1]

How can a small merchant confirm an exemption?

Ask the acquiring bank or payment provider to confirm the account classification and eligibility in writing. A QR image, shop size or this website cannot certify P2PM status. [S2]

Are wallet and credit-card UPI payments the same?

No. PPI interchange is a separate concept; credit-linked payments have their own product rules. Do not copy the bank-account merchant framework onto those methods. Ask the relevant provider for applicable terms. [S5] [S2]

What is the actual effective date?

The 13 October 2026 NPCI notice postpones implementation until after Diwali, with a separate date notification to follow. We have not verified a newer official start date. Do not infer a calendar date from the festival. [S3]

Can a new QR from this site avoid MDR?

No. A QR generator does not determine merchant classification, acquiring terms or fees. The NPCI FAQ says existing QR infrastructure does not need replacement just for this framework. [S2]

Official sources

Official source dates below are not this article’s publication date. Our review did not verify a newer implementation notice; that is a limit of this review, not official confirmation that nothing has changed.

Related reporting

These are media reports, separate from the official notices above. Report dates are not court filing dates or this article’s update date; the original affidavit and current docket have not been independently reviewed.

Policy change log

  • — Select merchant MDR framework announced. [S1]
  • — NPCI postponed rollout until after Diwali, with the date to be notified separately. [S3]
  • — Article correction: the previous review date represented automated source reading, not owner verification. Owner verification had not been recorded at this correction; no new policy rule or effective date is asserted. [S1] [S2] [S3] [S4] [S5]
  • — Added attributed reporting on NPCI’s Supreme Court counter-affidavit, with original-document and docket limits. No new official start date or court ruling is claimed. [S3] [R1] [R2]

Policy notice dates describe official events; article entries record substantive corrections or additions. Styling changes and rebuilds do not change these dates.