5 hrs ago

Small UPI MDR Reshapes Capital-Market Payment Economics

A new small fee will apply when people use UPI to send money to some investment businesses.

The fee is 0.02% of the payment and cannot exceed Rs 300.

It is meant to help pay for payment systems, security and fraud controls.

Investors should not see this as a separate charge at checkout.

Banks have been told not to let merchants pass the fee directly to customers.

The rule covers payments connected with mutual funds, brokers and other investment platforms.

Regular SIP payments through UPI AutoPay are reported to be excluded.

Brokers may ask customers to combine transfers or use other payment methods for large amounts.

The goal is to keep digital investing convenient while helping maintain the payment system.

Key facts

New MDR: 0.02% on eligible capital-market UPI payments.
Maximum charge: Rs 300; the article says this cap is reached at a Rs 15 lakh transfer.
Covered payments: Eligible payments involving mutual funds, securities, stockbrokers, securities dealers and investment platforms.
Excluded payments: UPI AutoPay mandates, including recurring systematic investment plan payments, are reported to remain outside the framework.
Investor impact: The MDR is intended to be an intermediary-side cost rather than a separate fee charged directly to investors.
Potential platform response: Intermediaries may promote consolidated transfers, recurring mandates or direct bank transfers to reduce repeated costs.
Rate discrepancy: The introduction describes a 0.04% baseline fee, while the body refers to a standard 0.4% UPI MDR.

financialexpress.com · 5 hrs ago