Traders have been raising concerns over the introduction of a Merchant Discount Rate (MDR) on certain UPI merchant transactions. The issue has led several trade organisations to announce protest programmes, including a proposed “No UPI Day” on October 2 and October 15.
However, there has been a fresh development. The planned October 2 protest was called off on October 1 following a meeting between trader representatives and Finance Minister Nirmala Sitharaman.
The earlier protest plan was linked to concerns over the new MDR framework for eligible UPI transactions above ₹2,000, which is scheduled to take effect from October 15, 2026.
Why Are Traders Opposing UPI MDR?
Under the new framework, eligible person-to-merchant UPI transactions above ₹2,000 will attract an MDR of 0.4%. For transactions above ₹2,000 in specified sectors such as railways, telecommunications, insurance, fuel and agricultural inputs, a flat ₹5 MDR will apply.
The charge is a merchant-side fee rather than a separate amount that customers are required to pay over and above their bill. Trade organisations have nevertheless expressed concern that the additional cost could affect businesses, particularly those operating with limited margins.
The proposed MDR framework has therefore become a point of discussion between trader organisations and the government.
What Was the No UPI Day Plan?
Before the latest development, some trader organisations had planned to observe October 2 as “No UPI Day” as a mark of protest. Business associations had also announced further programmes, including city-level protests on October 10 and another proposed No UPI Day on October 15.
The Bharatiya Udyog Vyapar Mandal, led by National President Babulal Gupta, was among the organisations that had announced opposition to the MDR issue. The organisation had said traders from 17 states, including Rajasthan, would participate in its movement.
The proposed protest involved traders expressing their opposition to the new MDR structure and using black bands as a symbol of protest.
What Is the Latest Position?
The situation changed on October 1, when trader representatives called off the October 2 protest after discussions with Finance Minister Nirmala Sitharaman. Reports said the traders had presented their concerns and demands to the government during the meeting.
This means the earlier plan to observe October 2 as a nationwide “No UPI Day” should not be treated as an ongoing programme.
The wider debate over MDR, however, remains connected to the new UPI merchant-payment framework scheduled to begin on October 15. Under the announced structure, eligible merchant transactions above ₹2,000 will be subject to the applicable MDR, while the fee will be borne on the merchant side rather than charged separately to customers.
Disclaimer
This article is intended for general informational purposes only. UPI rules, MDR rates, exemptions and implementation measures may be revised by the relevant authorities. Readers should check the latest announcements from the government, NPCI and their payment service providers before relying on information about UPI charges or merchant transactions.