Nirmala Sitharaman Clarifies UPI Charges.. Here’s What She Said!

Union Finance Minister Nirmala Sitharaman has clarified the Centre’s position on the new Merchant Discount Rate (MDR) framework for UPI transactions. According to the Finance Ministry, person-to-person UPI transfers will remain completely free, irrespective of the amount. Payments to merchants up to ₹2,000 and transactions covered under the zero-MDR framework for small merchants will also remain free, meaning around 96% of P2M transactions will be unaffected. The government has clarified that MDR is neither a tax nor a cess collected by it or NPCI, but is distributed among participants in the payment ecosystem.

Sitharaman has also criticised what she described as misinformation surrounding the new framework and said consumers would not bear the MDR. Under the framework, a 0.4% MDR applies to specified merchant transactions above ₹2,000, with the government saying the charge will not be passed on to customers. Separately, she objected to a mimicry performance involving constitutional offices at the ‘Chhatron Ki Goonj’ event attended by Rahul Gandhi in Indore, arguing that freedom of expression should be accompanied by respect for constitutional positions. Her remarks on the performance were reported by media outlets covering the event.