The implementation of the new UPI Merchant Discount Rate (MDR) framework could be postponed to January 2027.
NPCI has received requests from merchant bodies, fintech companies and payment firms seeking more time to prepare for the rollout. The new MDR framework was scheduled to come into effect from October 15, 2026.
Under the proposed framework, a 0.4 percent MDR would apply to eligible UPI person-to-merchant transactions above ₹2,000, subject to applicable caps and category-specific rules. Certain transactions, including some utility and financial service payments, have different fee structures.
Industry players have raised concerns about confusion over MDR rates and how different UPI transactions should be classified. Payment companies and merchants have also sought more time to resolve implementation issues before the festive season.
NPCI is expected to take a decision soon, with discussions reportedly underway with the Finance Ministry.
The proposed deferment would give the payments ecosystem additional time to clarify the framework and prepare for implementation. A final decision on the rollout date is still awaited.
