Annamalai Warns Centre Against UPI Charges

Tamil Nadu BJP leader K. Annamalai has criticised the proposed merchant discount rate (MDR) charges on certain UPI transactions, urging the Centre to protect small traders from additional costs. Speaking at an event organised by the All India Mobile Retailers Association in Udupi, he said safeguarding the livelihoods of local businesses was more important than generating revenue from the UPI system. Comparing UPI to a goose that lays golden eggs, Annamalai warned that imposing excessive charges in pursuit of immediate gains could undermine a system that has become an essential part of everyday life. He also noted that free transactions had played a significant role in UPI’s widespread adoption.

The Centre has said that charges are intended to support the maintenance and strengthening of the digital payments ecosystem, while maintaining that small merchants would not be affected. According to the details provided, a 0.4% charge was proposed on certain merchant transactions exceeding ₹2,000, while 96% of merchant transactions would remain free of charges. The National Payments Corporation of India (NPCI) reportedly announced that the proposed implementation, initially scheduled for October 12, had been postponed because of the festive season. Annamalai’s remarks have brought renewed attention to the debate over how to fund digital payment infrastructure without placing an additional burden on small businesses.