CNN Central News & Network-ITDC India Epress/ITDC News Bhopal: Union Minister Jyotiraditya Scindia has responded to Congress leader Rahul Gandhi’s criticism of the Centre’s new Merchant Discount Rate (MDR) framework for certain UPI transactions. Gandhi has alleged that the move reflects US pressure and could eventually increase costs for users, while the government has rejected claims of foreign influence.
The dispute follows the government’s decision to permit MDR on certain merchant UPI transactions above ₹2,000. From October 15, 2026, a 0.4% MDR is scheduled to apply to eligible transactions above that threshold, with exemptions for some small merchants and lower rates for certain essential sectors. Person-to-person UPI transfers remain free.
Gandhi has described the policy as a “UPI tax” and questioned whether the decision was influenced by the United States. Government representatives have rejected that interpretation and said the changes are intended to support the financial sustainability of the UPI ecosystem.
The issue has triggered a wider political debate over the future financing of India’s digital payments infrastructure. Supporters of the MDR framework argue that revenue can help fund technology, cybersecurity, fraud prevention and system reliability, while critics have raised concerns about the possible impact on merchants and consumers.
The controversy is continuing as the new MDR framework approaches its October 15 implementation date, with political parties debating its economic and consumer implications.
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