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India UPI MDR debate reopens following new taxation amendment bill
The passage of the Taxation and Other Laws (Amendment) Bill, 2026 has reignited discussions regarding the Merchant Discount Rate (MDR) for Unified Payments Interface (UPI) transactions in India. The amendment provides a legal mechanism to potentially modify the current zero-MDR structure for certain digital payment transactions.
Despite the new legal pathway, the Government has clarified that no immediate charges have been introduced. Consumer transactions and person-to-person payments are set to remain free, and small merchants will continue to be protected. No final MDR framework has been announced.
Industry experts at CARD91 emphasize that any selective MDR framework will require robust merchant intelligence. Ajay Pandey, CEO of CARD91, noted that the primary challenge lies in applying policy consistently to the correct merchants. The company argues that banks and acquiring institutions will need accurate, verified, and up-to-date business data to prevent inconsistent policy application and disputes.
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- [● 3 SOURCES] The Taxation and Other Laws (Amendment) Bill, 2026 creates a legal pathway to modify the existing zero-MDR structure for specific digital payments. onlinemediacafe.com · web3wire.org · bizrapidx.com
- [● 3 SOURCES] The Government has clarified that no immediate charges have been introduced via the Taxation and Other Laws (Amendment) Bill, 2026. onlinemediacafe.com · web3wire.org · bizrapidx.com
- [● 3 SOURCES] CARD91 suggests that implementing a selective Merchant Discount Rate (MDR) framework requires accurate merchant intelligence and verification rather than just pricing rules. onlinemediacafe.com · web3wire.org · bizrapidx.com
- [● 3 SOURCES] Small merchants will remain protected under the current discussions regarding UPI MDR. onlinemediacafe.com · web3wire.org · bizrapidx.com
- [● 3 SOURCES] Consumer and person-to-person payments will remain free under the proposed changes. onlinemediacafe.com · web3wire.org · bizrapidx.com