UPI and the cost of policy reversal
The government’s proposal to allow an MDR of 0.25–0.5% on UPI transactions above ₹2,000 reverses a decade-long policy; taxing the payment rail could weaken incentives for banks and fintechs to invest in UPI while undermining its role in financial inclusion, formalisation and wider digital adoption
· 8/10/2026, 4:46:16 PM· 2 min read
The government’s proposal to allow an MDR of 0.25–0.5% on UPI transactions above ₹2,000 reverses a decade-long policy; taxing the payment rail could weaken incentives for banks and fintechs to invest in UPI while undermining its role in financial inclusion, formalisation and wider digital adoption
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