The government has directed banks and payment system providers not to levy charges on UPI transactions of up to ₹2,000 or on payments made through RuPay debit cards, according to a gazette notification issued on September 14.
Under the notification, no bank or payment system provider can impose any direct or indirect charge on a person making or receiving a payment through UPI for transactions up to ₹2,000. The same protection applies to payments made through RuPay debit cards.
However, the notification does not clarify whether charges will be introduced for UPI transactions above ₹2,000, particularly those paid by merchants. UPI transactions have so far remained free across payment values, making the question of a possible Merchant Discount Rate (MDR) for higher-value payments a key point of discussion.
The move comes as digital payments continue to expand across India, with UPI becoming one of the country’s most widely used payment systems. The government’s decision ensures that small-value UPI payments remain free while the policy on higher-value transactions remains unclear.
