The government has budgeted ₹2,000 crore for the ongoing financial year under its incentive scheme for the promotion of RuPay Debit Cards and low-value BHIM-UPI transactions. (Representational image)
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The Merchant Discount Rate (MDR) on UPI will not be enough to cover the cost of running and maintaining the payment platform, and so the government will soon hold discussions with the Indian Banks’ Association (IBA) to decide on what quantum of the ongoing government subsidy should continue and in what form, sources in the Ministry of Finance have confirmed.
The Ministry of Finance will also coordinate with the IBA on how to ensure that merchants do not pass on the MDR charge to customers. The MDR charge will go live on UPI on October 15, and there is no proposal to delay this date, the sources said.
Published – September 25, 2026 12:22 pm IST
