Opposition MPs raise concerns over proposed UPI merchant payment fee

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Chairman of the Committee Bhartruhari Mahtab said that some MPs raised the issue at the meeting and said that it may be taken up at the next meeting of the pane. File | Photo Credit: Reuters

MPs, mostly belonging to the Opposition, on Wednesday (September 16, 2026) expressed concern over the government's decision to levy a fee on UPI payments above ₹2,000 to merchants, claiming that the entire population of the country would be affected due to the "anti-people" move.

Chairman of the Parliamentary Standing Committee on Finance Bhartruhari Mahtab said that some MPs raised the issue at the meeting and said that it may be taken up at the next meeting of the panel.

RSP MP N.K. Premchandran, who is a member of the committee, said that the entire population of the country would be affected by the government's decision to levy a fee on payments of above ₹2,000 to merchants. "It is a completely anti-people decision," Mr. Premchandran said.

Ending nearly six years of fully free UPI payments, the government on Tuesday (September 15) introduced a 0.4% fee on transfers worth more than $2,000 made to merchants through UPI from October 15, while explicitly ring-fencing everyday person-to-person transactions as well as small payments from any charge.

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Merchants to be charged 0.4% for UPI transactions over ₹2,000; small vendors exempt

"Customers will not be required to pay any charge when making such payments through UPI," the Finance Ministry said in a statement, adding, "MDR is a charge within the merchant payment ecosystem. It is not a charge on customers making UPI payments." Also, individuals will continue to have "unlimited free usage, with no monthly quotas, volume restrictions or tiered caps on free UPI transactions", it said.

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