India, Sept. 15 -- The Opposition on Tuesday slammed the BJP government over its decision to introduce a 0.4 per cent Merchant Discount Rate (MDR) on UPI payments above Rs.2,000 made to merchants. The Congress called it the "Modi tax" and alleged that a "compromised" prime minister had "surrendered" to US pressure.

After nearly six years of allowing merchants to use UPI without a transaction fee, the government announced a 0.4 per cent MDR charge on payments above Rs.2,000, effective October 15.

MDR is a fee that merchants pay to banks and payment companies when a customer makes a digital payment. The new rules apply only to person-to-merchant (P2M) transactions above Rs.2,000. Person-to-person (P2P) payments will continue to remain fre...