Not confirmed. October 15, 2026 remains the announced start date for the UPI merchant discount rate (MDR) framework, but reports on October 8 said a delay to January 2027 was being considered. Finance Minister Nirmala Sitharaman said stakeholders would decide when MDR is levied; no reviewed official notice confirms a change to the date. The reported UPI Steering Committee discussion was expected on October 9.
That timing question is separate from who the announced fees cover: person-to-person transfers remain free, and the framework exempts merchant payments up to ₹2,000.
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Has the October 15 start date been delayed?
As of reports published on October 8, the October 15, 2026 schedule had not been formally changed. The Times of India reported, citing a regulatory official and an industry executive familiar with the matter, that the government may postpone the rollout by a few months, with January 2027 under discussion. Moneycontrol reported that the UPI Steering Committee was expected to discuss the proposal on October 9.
Sitharaman told Moneycontrol: “Deferment of MDR will be handled by the stakeholders. Its on them to decide from when MDR will be levied on UPI transactions.” Her statement leaves the timing to stakeholders; it does not confirm that a postponement has been agreed. Until NPCI or the Ministry announces a revised effective date, October 15 remains the announced schedule. The Times of India’s October 8 report and Moneycontrol’s report quoting the Finance Minister describe a proposal and process, not a final date change.
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Will people pay to send money through UPI?
No, under the Ministry of Finance’s announced framework, person-to-person (P2P) UPI transfers remain free regardless of amount. The Ministry says no transaction, platform or other charge is to be imposed on individuals for sending or receiving money.
The proposed MDR concerns specified person-to-merchant (P2M) transactions. It is a merchant-side payment-system charge, not a tax collected by the Government or NPCI. The Ministry says banks have been advised to ensure merchants do not pass MDR on to customers, and UPI application providers may not impose platform or hidden charges. This is the official framework and guidance; it does not establish how every merchant will handle its costs.
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Which merchant UPI payments are covered by the announced framework?
The Ministry’s September 15, 2026 statement sets out different treatment by transaction type, value and merchant category. The general ₹2,000 threshold is for merchant transactions; it does not change the free status of P2P transfers.
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Fix the driver behind crashes, sound loss and screen glitchesFind Drivers →Repair Windows errors before they cause bigger problemsFix Now →Scan for outdated or missing drivers - takes under a minuteDriver Scan →| Transaction or merchant category | Announced MDR treatment |
|---|---|
| P2P transfers, any amount | Free; no individual transaction, platform or other charge under the stated framework. |
| P2M merchant payments up to ₹2,000 | No MDR. |
| Specified P2M payments above ₹2,000, general category | 0.4%; capped at ₹300 for transactions of ₹75,000 or more. |
| Payments above ₹2,000 in railways, telecommunications, insurance, fuel and agricultural inputs | Flat ₹5 MDR, as listed by the Ministry. |
| Payments relating to mutual funds, securities, stockbrokers and dealers | 0.02%, capped at ₹300. |
| Small merchants in the P2PM category receiving up to ₹1 lakh per month through UPI QR codes | Zero MDR on all transactions. |
These are category-specific rules, not one rate for every payment above ₹2,000. The Ministry’s September 15, 2026 statement says about 96% of P2M transactions will remain unaffected and about 4% are expected to attract MDR. It also says P2P accounts for 70% of total transaction value. These are estimates published by the Ministry, not independently validated figures.
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Does a payment above ₹2,000 mean the customer pays extra?
Not under the official framework: MDR is assigned to the merchant, while the Ministry says banks should ensure it is not passed to customers and UPI apps may not add platform or hidden fees. The framework therefore does not mean that every customer making a merchant payment above ₹2,000 will be charged. The stated rates and exceptions apply to eligible merchant transactions, not to all UPI use.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.What have officials said about the effect of MDR?
RBI Governor Sanjay Malhotra told The Times of India on October 8: “As of now, we do not see any drop in volumes. And I don’t personally think that a small fee will have a major impact on the volumes.” This is his assessment of the likely effect, not evidence of what transaction volumes will do after the framework takes effect.
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