New Delhi, Sept. 25 -- The new Merchant Discount Rate (MDR) on specified UPI transactions is set to create a new revenue stream for the digital payments ecosystem, with the money collected from merchants to be divided among banks, payment gateways, UPI apps and sponsoring banks.

Finance Minister Nirmala Sitharaman has rejected allegations that the decision to introduce the charge was driven by external pressure, saying the framework was a professional decision taken by participants in the payments ecosystem.

"Absolutely baseless. And I totally deny it," Sitharaman said when asked about Opposition allegations that the UPI MDR decision was taken under external pressure, particularly from the US.

Under the new framework, 40 per cent of MD...