Amid all cost cutting moves and downsizing, NPCI has yet again come for the rescue of Indian natives and has overhauled its cost structure in relation to UPI payments. This is to boost digital transactions in an aim to revolutionize the system.
MDR or merchant discount rate has been pegged at a maximum of Rs. 100 for high-volume transaction, whereas for the offline transactions valuing less than Rs. 100, there will be no such charges.
Dilip Asbe, MD & CEO, NPCI said "The Zero MDR for transaction up to Rs 100 and increased limit for P2PM category (Small merchants) will help faster migration from cash to digital using BHIM UPI. The lower MDR will encourage all categories and types of merchants to deploy the asset-lite acceptance infrastructure (BHIM UPI QR code) to grow digital footprint across the country. We envisage this reduction in MDR will encourage merchants to start accepting BHIM UPI and grow the volume on merchant transactions multi-fold."
For transactions up to Rs. 2000, the MDR is capped at 0.25% while for higher transaction valuing over Rs. 2000, the MDR is capped at 0.65%. These new rates will come into effect from October 1, 2019, said an NCPI statement.
The MDR for transactions done using QR Scan or Pay will be free of cost up to the value of Rs. 100.