New Delhi, Oct. 7 -- A small merchant discount rate (MDR) on select Unified Payments Interface (UPI) transactions is unlikely to have a major impact on transaction volumes, Reserve Bank of India (RBI) Governor Sanjay Malhotra said on Wednesday after the October monetary policy review.

Asked whether the introduction of MDR from 15 October could lead to a fall in UPI volumes and whether the RBI could consider bearing the cost for the larger good, Malhotra said a decision on MDR had already been taken.

"As of now, we do not see any drop in volumes, and I don't personally think that a small fee will have a major impact on the volumes," he said at the post-policy press conference.

The comments come as UPI is set to move away from its long-s...