New UPI MDR Won't Affect 75% of Merchants: NPCI
NPCI's Dilip Asbe says nearly 75% of UPI merchants won't be affected by the new MDR on transactions above Rs 2,000, as they never cross that threshold.
Key Highlights:
- NPCI's Dilip Asbe said around 75% of UPI merchants will remain unaffected by the new MDR since they've never recorded a transaction above Rs 2,000.
- India has over 60 million unique UPI merchants, and most of them fall below the transaction threshold triggering MDR.
- About 80% of the total MDR value is expected to come from merchants with annual GMV exceeding Rs 1,000 crore.
- Asbe said larger merchants already familiar with card payment charges are unlikely to pass the MDR cost onto consumers.
- Only around 10% of merchant value carries a real risk of the MDR being transferred to customers, he said.
Most Merchants to Remain Unaffected
Around three-fourths of India's digital payment-accepting merchants will remain unaffected by the newly introduced merchant discount rate (MDR) on Unified Payments Interface (UPI) transactions above Rs 2,000, as they have never recorded a transaction exceeding that amount, National Payments Corporation of India (NPCI) Managing Director and Chief Executive Officer Dilip Asbe said on Thursday.
The Scale of India's Merchant Base
Speaking at the SBI Banking and Economic Conclave, Asbe said India has more than 60 million merchants accepting digital payments, and nearly 75 per cent of them have not seen a single transaction above Rs 2,000. As a result, the MDR policy will have no impact on the majority of merchants.
Asbe's Statement on the Policy's Reach
"We have about 60 million unique UPI merchants, and 75 per cent of them have not seen a transaction above Rs 2,000. Therefore, the majority of merchants will not be impacted by the MDR," he stated, offering a clear quantitative basis for his broader reassurance to smaller merchants.
