Archive · 17 Sep 2026
Supreme Court PIL Challenges New UPI Charges Above ₹2,000
A person has asked India’s Supreme Court to examine new fees on some UPI payments.
The case concerns payments from people to businesses that are above ₹2,000.
Most of these larger payments could have a fee of 0.4%, with a maximum charge of ₹300.
Some sectors, such as fuel and railways, could instead have a flat ₹5 fee.
Payments up to ₹2,000 and transfers between two people would stay free.
Eligible small merchants receiving up to ₹1 lakh each month through QR codes would also be protected.
The petitioner says the government did not clearly explain how it chose the fees, limits and sectors.
He also says the full fee rules were not properly published or opened for public discussion.
The petition argues that merchants might indirectly pass costs to customers or reduce their acceptance of UPI.
A PIL filed by advocate Anjan Datta challenges UPI MDR provisions and amended Section 10A of the Payment and Settlement Systems Act, 2007.
The framework permits a 0.4% MDR on general P2M UPI transactions above ₹2,000, capped at ₹300 for transactions of ₹75,000 and above.
A flat ₹5 MDR applies to qualifying transactions above ₹2,000 in specified sectors, while capital-market transactions face a 0.02% charge capped at ₹300.
UPI payments up to ₹2,000, person-to-person transfers and eligible small merchants receiving up to ₹1 lakh monthly through QR codes remain protected from MDR.
The petitioner alleges excessive delegation, inadequate publication and consultation, arbitrary thresholds, unequal treatment of RuPay debit cards and possible harm to merchants and consumers.
- Who
- Advocate Anjan Datta filed the PIL against the Union government, the Ministry of Finance, the Reserve Bank of India, the National Payments Corporation of India and the UPI and Services Steering Committee.
- What
- The PIL challenges the September 14 notification, the September 15 MDR framework and the constitutional validity of amended Section 10A of the Payment and Settlement Systems Act, 2007.
- When
- The PIL was filed on a Wednesday, one day after the Ministry of Finance announced the fee structure; the articles do not definitively identify the year for the September dates.
- Where
- The challenge was filed in the Supreme Court of India and concerns UPI transactions in India.
- Why
- The petitioner alleges that the framework is arbitrary, discriminatory, insufficiently transparent and unsupported by clear legislative criteria or disclosed evidence.
Petitioner’s objections
Framework’s stated provisions
Legal authority
Petitioner’s objections
The petitioner argues that amended Section 10A gives the executive unguided power to choose protected payment modes, transaction limits and merchant classifications, and that the amendment was improperly enacted as part of a Money Bill.
Framework’s stated provisions
The framework relies on amended Section 10A of the Payment and Settlement Systems Act, 2007, to define which electronic payment transactions receive no-charge protection and which may attract MDR.
Publication and consultation
Petitioner’s objections
The petitioner says the September 14 notification did not itself prescribe the rates, that the detailed charges were announced through a press release and that no complete operative instrument, consultation paper or impact study was disclosed.
Framework’s stated provisions
The Ministry of Finance announced a detailed fee structure after deliberations of the UPI and Services Steering Committee, according to the articles.
Thresholds and classifications
Petitioner’s objections
The petitioner questions the ₹2,000 transaction threshold, the ₹1 lakh monthly merchant threshold, the sector classifications and the absence of disclosed empirical data, arguing that they create arbitrary cliff-edge outcomes.
Framework’s stated provisions
The framework differentiates between smaller and larger transactions, exempts eligible small merchants and applies separate rates to general, specified-sector and capital-market transactions.
UPI, RuPay and economic impact
Petitioner’s objections
The petitioner argues that UPI and RuPay debit cards receive unequal treatment and warns that MDR could burden low-margin merchants, indirectly raise consumer costs, cause refusals or minimum ticket sizes and affect digital-payment adoption.
Framework’s stated provisions
The framework preserves no-charge protection for RuPay debit cards, UPI payments up to ₹2,000, person-to-person transfers and eligible small merchants while applying stated rates and caps to other transactions.
- General P2M MDR
- 0.4% on UPI transactions above ₹2,000, capped at ₹300 for transactions of ₹75,000 and above.
- Specified-sector MDR
- A flat ₹5 on qualifying transactions above ₹2,000 in sectors including railways, telecommunications, insurance, fuel and agricultural inputs.
- Capital-market MDR
- 0.02%, capped at ₹300.
- Transactions remaining free
- UPI payments up to ₹2,000 and person-to-person UPI transfers.
- Small-merchant exemption
- Eligible merchants receiving up to ₹1 lakh per month through UPI QR codes are exempted, according to the articles.
- Provision challenged
- Amended Section 10A of the Payment and Settlement Systems Act, 2007.
- RuPay treatment
- RuPay-powered debit-card transactions retain no-charge protection without a monetary ceiling, according to the challenged notification.
