Mumbai, September 16 (Daily Kiran) : Mumbai’s digital payment landscape is poised for transformation as the co-founder of BillDesk, Srinivasa MN, announced new regulations on Wednesday. The Indian government plans to implement a Merchant Discount Rate (MDR) for UPI transactions exceeding ₹2,000. This initiative aims to bolster the digital payment ecosystem rather than impose additional burdens on consumers or small merchants.
In a conversation with a news agency, Srinivasa clarified that UPI payments will remain free for consumers. Most transactions conducted by small businesses will also incur no fees. The MDR will only apply to select transactions above the ₹2,000 threshold, allowing the generated resources to be reinvested into expanding the UPI network and enhancing technological infrastructure.
Srinivasa emphasized that there should be no misconceptions regarding UPI. He reiterated, “For the average consumer, UPI will remain entirely free, and there will be no charges on low-value transactions.” He also mentioned that a discounted fee structure would apply to regular payments such as utility bills, government tax payments, insurance premiums, and fuel purchases. This balanced model is expected to encourage digital payments while providing necessary resources for payment service providers.
He noted that UPI has become an integral part of daily life for millions of Indians, facilitating purchases, bill payments, fund transfers, and other financial activities. The widespread adoption of UPI is attributed to significant investments by banks, financial institutions, and the broader digital payment industry.
As UPI aims to reach more areas and new users, there is a growing need for investment in new technologies, cybersecurity, and customer education. Srinivasa stated, “The next phase of digital payments will not only focus on increasing user numbers but also require ongoing investment in cybersecurity, fraud prevention mechanisms, customer education, and advanced technological frameworks.”
He added that a portion of the resources obtained from MDR will be allocated to establish a special fund aimed at promoting digital transactions among small merchants and expanding UPI’s reach across the country.
India has emerged as a global leader in retail digital payments, with over 50% of the world’s retail digital transactions taking place in the country. This statistic underscores the success of India’s digital payment revolution. Srinivasa pointed out that significant opportunities for expanding digital payments still exist. Currently, UPI has reached approximately 500 million users, representing only about one-third of India’s total population. This leaves room for millions of new consumers and businesses to be integrated into the digital payment system in the coming years.
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