New Delhi: A new UPI payment charge framework will come into effect from October 15, 2026, but customers will continue to use UPI without paying transaction fees.
Under the new system, merchants will pay 0.4% MDR on standard UPI payments above Rs 2,000. The charge will be capped at Rs 300 for transactions of Rs 75,000 or more.
Certain sectors, including fuel, insurance, telecom and railways, will follow a flat Rs 5 charge for payments above Rs 2,000. Capital-market transactions will attract 0.02% MDR, subject to a Rs 300 ceiling.
The charges will be collected from merchants and cannot be transferred to customers. UPI apps will also be barred from adding separate platform fees.
Person-to-person transfers will remain free. Small merchants covered under the P2PM category will also continue to receive UPI payments without MDR.
The government said the new framework will help fund UPI infrastructure, cybersecurity, innovation and wider digital-payment expansion.