India, Sept. 16 -- Investment platforms Zerodha and INDmoney have flagged the cost impact of the new merchant discount rate (MDR) on UPI transactions, warning that they could incur charges on fund transfers without necessarily generating corresponding trading revenue.

While Zerodha cofounder and CEO Nithin Kamath called for the charge on broking transactions to be capped at Rs.5 or Rs.10, INDmoney founder Ashish Kashyap used a hypothetical example to illustrate the potential cost for investment platforms under the new framework.

The concerns came after the Centre introduced a new MDR framework that will end nearly six years of fully free UPI payments for certain merchant transactions.

Under the new UPI MDR framework, which will come in...