Mumbai, Aug. 3 -- The finance ministry has proposed amendments to the Payment and Settlement Systems Act, 2007, that could pave the way for the return of merchant discount rate (MDR) on unified payments interface (UPI) transactions. The changes, which are unlikely to burden UPI users, would give government the flexibility to levy merchant charges on notified digital payment modes, as it seeks a sustainable funding model for the platform's next phase of growth.

Finance minister Nirmala Sitharaman will introduce the Taxation and Other Laws (Amendment) Bill, 2026 in Lok Sabha on Tuesday, seeking amendments to the payment and settlement systems law, the Income-Tax Act, 2025, and the Finance Act, 2026, according to the list of business for th...