“Supreme Court Seeks Centre, RBI Response on UPI MDR Charges
What Happened
The Supreme Court of India refused to grant an interim stay on the 0.4% Merchant Discount Rate (MDR) imposed on UPI transactions above ₹2,000. A bench led by Justice Sanjiv Khanna questioned the government on whether the levy qualifies as a tax, fee, or expropriation, and sought detailed responses from the Centre, RBI, and NPCI. The petition, filed by traders and consumer groups, argues that MDR burdens merchants and undermines UPI’s zero‑cost model. The court has directed the authorities to file replies within four weeks.
Key Takeaways
The Supreme Court’s intervention places the legal validity of UPI MDR under scrutiny, raising questions about its classification and fairness. The outcome could significantly impact digital payments, merchants, and fintech firms across India.