BUSINESSThe Hindu Business · 10 hours agoLive
UPI and the cost of policy reversal
Reported by The Hindu Business, not nibnow. We are not the publisher of this story, only the source is.
WHY IT MATTERS
Reversing the zero‑MDR policy could reduce banks' and fintechs' incentives to invest in UPI, potentially slowing the platform's contribution to financial inclusion and digital payments growth.
WHAT HAPPENED
The government’s proposal to allow an MDR of 0.25–0.5% on UPI transactions above ₹2,000 reverses a decade-long policy; taxing the payment rail could weaken incentives for banks and fintechs to invest in UPI while undermining its role in financial inclusion, formalisation and wider digital adoption
WHAT TO WATCH
- •Final government decision on the proposed MDR range
- •Responses from banks, fintech firms and merchant groups
- •Any changes in UPI transaction volumes or pricing structures after the policy is implemented
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