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India Delays UPI Merchant Fees Amid Retailer Protests

India Delays UPI Merchant Fees Amid Retailer Protests

First seen 13 Oct 2026, 14:32 UTC • •
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ThreatCluster AI
ThreatCluster •October 14, 2026 at 08:29 UTC
  • •India's NPCI has delayed UPI merchant fees amid retailer protests.
  • •The 0.4% fee was set for transactions over ₹2,000 and aimed to cover operational costs.
  • •Retailers warned that the fee could lead to significant financial losses.

India has postponed the introduction of a 0.4% Merchant Discount Rate (MDR) on UPI transactions exceeding ₹2,000, originally set to take effect on October 15, 2026. The National Payments Corporation of India (NPCI) cited the festive shopping season as a reason for the delay, which follows significant pushback from retailers, including mobile phone sellers. The All India Mobile Retailers Association (AIMRA) had previously organized a 'No UPI Day' protest on October 2, 2026, against the proposed fees, arguing it would lead to substantial financial losses for small retailers. The NPCI had aimed to implement the fees to help cover the operational costs of UPI, which processed over 24 billion transactions worth ₹29.37 trillion in September 2026 alone. The new fee structure will be reviewed after Diwali, but no specific date for implementation has been provided.

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Timeline

2026-10-02
Mobile retailers protest against UPI fees
AIMRA organized a 'No UPI Day' to protest the proposed 0.4% MDR on UPI transactions, highlighting potential losses for small retailers.
The Hindu
2026-10-13
NPCI delays UPI fee rollout
The NPCI announced the postponement of the 0.4% MDR on UPI transactions, originally set for October 15, due to the festive shopping season.
Techcrunch

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Common questions

What is the new UPI fee structure?
The proposed structure includes a 0.4% fee on transactions over ₹2,000, with exemptions for smaller transactions.
Why was the fee rollout delayed?
The NPCI delayed the rollout to avoid impacting the festive shopping season, responding to retailer pushback.
What are the potential impacts on retailers?
Retailers fear the fee could lead to monthly losses of ₹2,000 to ₹12,000, significantly affecting their income.