The government may soon bring back a small fee on UPI payments above ₹3,000. This fee is called the Merchant Discount Rate (MDR). Right now, there is no MDR on UPI payments, but banks and payment companies say handling big payments is becoming expensive for them. So, the government is thinking of charging MDR only on high-value transactions, not on small ones. This means if you pay a big amount using UPI (above ₹3,000), the shop or business may have to pay a small fee to the bank.

UPI makes up around 80% of all digital payments in India. But because banks don’t earn anything from UPI payments, they don’t want to invest more in improving the system. The Payments Council of India has suggested that large businesses should pay a 0.3% fee on UPI payments. Right now, businesses already pay 0.9% to 2% on card payments.RuPay credit cards will likely not have this new fee.

The final decision will be made in 1–2 months after the government talks to banks, payment apps, and the National Payments Corporation of India (NPCI). If the plan goes ahead, it will help make digital payments more stable and fair for everyone involved.

UPI transaction limit

The normal daily limit for UPI payments is ₹1 lakh. But this can change depending on the type of payment and your bank. For example, payments for insurance, stock market investments, or money from other countries may have a higher limit of ₹2 lakh. Some banks may also set their limits, usually between ₹25,000 and ₹1 lakh per day. Also, you can make a maximum of 20 UPI payments in one day, as per ClearTax.