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NPCI Says GST on UPI MDR Will Not Burden Small Merchants
- Starting October 15, India's Unified Payments Interface will cease to be free after regulators permitted a 0.4 per cent merchant discount rate on transactions exceeding 2,000 rupees .
- This shift ends UPI's six-year reign as a free network, aligning India's system with global retail payment models like China's Alipay and Brazil's Pix, where fees range from 0.6 per cent to 1.5 per cent.
- Brokerage Bernstein estimates the fee could generate annual revenue of up to $1.1 billion by March 2028, with dominant apps PhonePe and Google Pay potentially capturing $900 million based on their market share.
- Retailers in Mumbai, including Suvidha manager Govind Rawal, expect to absorb these costs rather than pass them to consumers, while analysts and merchants agree a shift back to cash remains unlikely.
- Smaller rivals like MobiKwik now plan to target higher-value transactions and credit offerings, though regulators may revive discussions regarding a 30 per cent market-share cap on dominant players.
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Banks to monitor merchants to ensure UPI MDR is not passed on to consumers: Govt sources - The Tribune
Banks will monitor merchants to ensure that the Merchant Discount Rate (MDR) on UPI transactions is not passed on to consumers, while the Indian Banks' Association (IBA) will develop a mechanism to prevent merchants from charging customers extra for digital payments, according to government sources.
·Chandigarh, India
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Big to get bigger: India's UPI fee shift to entrench dominant incumbents
Walmart-backed PhonePe and Google Pay could earn hundreds of millions of dollars a year in extra revenue from India's move to allow merchant fees on its widely used Unified Payments Interface (UPI) digital payment network, entrenching the dominant apps' lead over smaller rivals.
·London, United Kingdom
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Coverage Details
Total News Sources70
Leaning Left4Leaning Right11Center5Last UpdatedBias Distribution55% Right
Bias Distribution
- 55% of the sources lean Right
55% Right
L 20%
C 25%
R 55%
Factuality
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