Paytm on Tuesday said that the introduction of Merchant Discount Rate (MDR) of up to 0.4% on UPI Person-to-Merchant (P2M) transactions exceeding Rs 2,000 will generate additional revenue from the merchant business for many payment transactions that were free earlier.
In a regulatory filing, the company said, “This will generate additional revenue from the merchant business for many of the payment transactions that were free earlier.”
It added, “As per the NPCI Circular, no charge is levied on customers for UPI payments, which shall continue to remain free of charge for them.”
Paytm said it will make further disclosures, if required, once the circular becomes effective and its impact is ascertained.
The Reserve Bank of India said the introduction of MDR on large-value UPI transactions is an important step towards strengthening the long-term sustainability of India’s digital payments ecosystem
“It will help UPI in continuing to scale, innovate and serve consumers and businesses across the country,” the RBI said in a post on X.
The RBI said a fair and appropriate distribution of MDR across ecosystem participants will support continued investment in technology, infrastructure and acceptance networks.
It also clarified that all UPI transactions – both Person-to-Person (P2P) and Person-to-Merchant (P2M) – will remain free for users, while P2M UPI transactions below Rs 2,000 will continue
