New Delhi, Aug. 10 -- The Government has clarified that consumers will not be charged for making payments through the Unified Payments Interface (UPI), while any future Merchant Discount Rate (MDR) would apply only to a limited category of merchant transactions and at a nominal rate.

The clarification follows the proposed amendment to Section 10A of the Payment and Settlement Systems Act, 2007, through the Taxation and Other Laws (Amendment) Bill, 2026. The amendment is described by the government as an enabling provision for determining a framework for UPI charges.

According to the government, all Person-to-Person (P2P) UPI transactions will continue to remain free. It also stated that the majority of merchant transactions will remain ...