The Lok Sabha on Thursday passed amendments to the Payment and Settlement Systems (PSS) Act, 2007, paving the way for the Centre to allow banks and payment service providers to levy charges on Unified Payments Interface (UPI) transactions and other notified digital payment modes.
The amendment removes the existing legal provision that bars banks and payment system providers from imposing a Merchant Discount Rate (MDR) on notified electronic payment modes. However, the Bill does not immediately impose charges on UPI transactions. Instead, it empowers the central government to notify the digital payment modes on which such charges may be permitted in the future.
