Two days since Deepavali, the National Payments Council of India is yet to notify a new date for the implementation of the Merchant Discount Rate (MDR) on UPI transactions and The Hindu has learnt that “there is no announcement on this at the moment”.
When it had put the proposed additional charge on hold nearly a month ago, the NPCI had said the new date would be announced “immediately” after Deepavali. The new rate was originally supposed to have been implemented on October 15.
“There is no announcement on this at the moment,” a spokesperson at the NPCI told The Hindu when asked whether the NPCI’s date announcement was imminent.
The matter of an MDR levy on specified UPI transactions received significant pushback from merchants and petrol pump dealers alike, apart from customers who feared that merchants would pass on the extra charge on to them by way of higher prices.
The petrol pump dealers further said that the MDR charge, coupled with the fact that their dealer commission had not been revised in several years, meant that their margins would be further squeezed.
The NPCI had on October 13 announced that its UPI and Services Steering Committee had decided that “keeping in mind the festive season, Merchant Discount Rate (MDR) on select Person-to-Merchant (P2M) UPI transactions, shall be implemented immediately post Diwali at a date to be notified separately”.
The Hindu had at the time reported that, according to government sources, the decision to delay the implementation of MDR on UPI was made in the Prime Minister’s Office following strong appeals from traders.
Praveen Khandelwal, founder and secretary-general of the Confederation of All India Traders (CAIT) and a Bharatiya Janata Party (BJP) Lok Sabha member, had welcomed the deferment, saying that it would protect traders’ interests and sustain digital payment momentum during the festive season.
