The Merchant Discount Rate (MDR) on UPI payments above Rs 2,000 will not be passed on to customers, Union Finance Minister Nirmala Sitharaman said, ruling out any burden on consumers even as the finance ministry moves to engage banks and traders' bodies to ensure the charge does not filter down the chain.
"This is not a tax, this is not a cess, and it is not even a surcharge. The collection is not going to the Consolidated Fund of India. So, let us first understand that this is not a government issue. The MDR is being charged by NPCI, the aggregator, the service provider, those who provide the POS machines, and the merchant bank. They are the ones providing the service. Above Rs 2,000, the merchant is the one who will pay. That money is not coming to the Government of India, and we are not imposing it. And this will not be passed on to the customer," Sitharaman told PTI.
