The government on Wednesday debunked claims that its decision to levy Merchant Discount Rate (MDR) on some merchant UPI payments was influenced by foreign pressure. Since the announcement of the UPI charge, several critics of the move, including the main opposition Congress party, have accused the government of introducing the fee to favour the United States and please US President Donald Trump.
Finance Ministry Addresses Digital Payments Decision
The finance ministry has announced that its recent decision regarding the digital payments ecosystem aims to create a self-sustaining, inclusive, and affordable system. This statement was made via a post on X, emphasizing that the decision was made independently. The ministry firmly rejected any allegations of foreign influence, labeling such claims as false.
Rahul Gandhi, on Wednesday, accused the government of ‘lying down in front of US President Donald Trump’ by burdening ‘every single Indian person’ with a ‘UPI tax’. This is false. The government also reiterated several points regarding the new UPI framework and clarified that UPI remains free for consumers.
“Some claims suggest the change is due to foreign influence. 4. Nominal MDR above ₹ 2,000: Larger merchant transactions above ₹ 2,000 will attract a 0.4% fee, to be borne by merchants.
India’s UPI policy decisions are made independently, with the clear goal of building a self-sustaining, inclusive, and affordable digital payments ecosystem,” the Ministry of Finance said. The government said this is significantly lower than credit-card charges and other network fees. The government said the decision to introduce a small fee on higher-value merchant transactions was aimed at keeping the UPI system self-sustainable, secure and innovative. “The new framework ensures resources from higher-value merchant transactions are reinvested to support small businesses and strengthen digital payments across the country,” the Ministry of Finance said.
