India, Nov. 5 -- The Centre on Thursday defended the proposed Merchant Discount Rate (MDR) charges on Unified Payments Interface (UPI) transactions above Rs.2,000, telling the Supreme Court that merchants were never assured that UPI payments would remain free indefinitely.

In a counter-affidavit filed before the Supreme Court on November 4, the Union government said the revised MDR framework had been under consideration well before its introduction and was finalised after consulting stakeholders.

"Further, no specific assurance of a continuing zero-MDR regime was given to merchants, and the subsidy provided by the State was discretionary rather than obligatory," the Centre said.

The government was responding to a Public Interest Litiga...