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UPI September Growth Meets Concerns Over October MDR Rollout
People in India used UPI for 24.07 billion payments in September.
Together, those payments were worth ₹29.37 lakh crore.
The monthly total was slightly lower than August’s, partly because September had one fewer day.
On average, people made 802 million UPI payments each day.
Bigger festive-season purchases helped push the average daily payment value to a record level.
Starting October 15, some business payments above ₹2,000 will have a small fee.
Payments between two people will still be free, and most smaller merchant payments will not have the fee.
Some traders worry the fee could make digital payments harder for businesses, while experts expect UPI use to remain strong.
UPI processed 24.07 billion transactions worth ₹29.37 lakh crore in September, up 23% and 18% year-on-year respectively.
Monthly UPI volume fell 1.8% from August’s 24.51 billion transactions, while value declined from ₹29.82 lakh crore; September had one fewer day.
UPI set records of 802 million daily transactions and ₹97,913 crore in average daily value, partly supported by festive spending.
From October 15, a 0.40% MDR capped at ₹300 will apply to specified person-to-merchant payments above ₹2,000.
Traders have raised concerns about the fee, but experts expect limited impact because most transactions remain exempt and person-to-person payments stay free.
- Who
- Consumers, merchants, traders, fintech companies, the National Payments Corporation of India, and digital-payment users in India.
- What
- UPI processed 24.07 billion September transactions worth ₹29.37 lakh crore, while a new MDR will apply to specified merchant payments above ₹2,000.
- Where
- Across India, including large cities, smaller towns, rural communities, and neighbourhood merchants.
- When
- September; the MDR framework is scheduled to begin on October 15.
- Why
- Festive spending supported higher-value payments, while the MDR framework is intended to establish charges for certain merchant transactions; traders have raised concerns about its effect on businesses and adoption.
MDR Could Support Sustainable Payments
MDR Could Burden Merchants
Effect on UPI adoption
MDR Could Support Sustainable Payments
Experts and payment-industry executives expect limited impact because more than 96% of merchant transactions are up to ₹2,000, UPI remains cheaper than cards, and person-to-person payments remain free.
MDR Could Burden Merchants
Traders’ representatives said a 0.40% fee on larger merchant payments could increase costs for small and medium businesses and affect digital-payment adoption among merchants.
Purpose of the framework
MDR Could Support Sustainable Payments
Akshay Mehrotra said a modest MDR could support continued investment in secure, reliable, and innovative payment infrastructure.
MDR Could Burden Merchants
The traders’ delegation expressed concern over the proposed fee and had considered observing October 2 as a “No UPI Day” before withdrawing that call after meeting Finance Minister Nirmala Sitharaman.
Key facts
- September UPI volume
- 24.07 billion transactions
- September UPI value
- ₹29.37 lakh crore
- Daily UPI record
- 802 million transactions and ₹97,913 crore in average daily value
- Year-on-year growth
- UPI volume rose 23% and value rose 18%
- MDR rate
- 0.40% on specified person-to-merchant payments above ₹2,000, capped at ₹300
- Exemptions
- Person-to-person payments and UPI payments up to ₹2,000 remain free; merchants receiving up to ₹1 lakh monthly are also outside the framework
- IMPS performance
- ₹7.06 lakh crore in September, up 18% year-on-year
Quotes
Akshay Mehrotra
Managing director and group CEO of Fibe
“India's festive season is shaping up to be a celebration of consumer confidence, and UPI monthly transactions of 24.07 billion worth ₹29.37 lakh crore show how firmly digital payments have taken root in everyday life. This momentum creates a great opportunity for fintech: connecting payments with timely, affordable credit for the people driving India's consumption story.”
businesstoday.in
Sources
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