UPI MDR not tax, cess or surcharge; won’t burden consumers, says FM Nirmala Sitaraman

The proposed Merchant Discount Rate (MDR) on select high-value UPI transactions is neither a tax, cess nor surcharge, and will not be passed on to consumers, Finance Minister Nirmala Sitharaman said on Friday.

The 0.4 per cent MDR on specified person-to-merchant (P2M) UPI transactions above Rs 2,000 will be borne within the merchant payment ecosystem and will not accrue to the government, Sitharaman told PTI.

“This is not a tax, this is not a cess, this is not even a surcharge. And the collection is not coming to the Consolidated Fund of India,” she said.