New Delhi, Aug. 13 -- The government is considering bringing back the Merchant Discount Rate (MDR) for a limited category of high-value UPI transactions as it looks for a sustainable way to fund India's rapidly expanding digital payments ecosystem.

A Parliamentary Standing Committee on Finance has recommended the early implementation of a calibrated, tiered MDR framework for higher-value merchant transactions while protecting small merchants and person-to-person (P2P) payments. However, the government has not yet finalised the transaction threshold or MDR rate, PTI reported.

There is currently no confirmed transaction limit above which UPI payments would attract an MDR. According to a reply from the Department of Financial Services (DFS...