After a meeting with Finance Minister Nirmala Sitharaman, major traders’ organisations cancel plans for a ‘No UPI Day’ protest, but continue to seek postponement and adjustments to the proposed merchant discount rate on high-value digital transactions.
Two major traders’ organisations have withdrawn plans for a “No UPI Day” protest on 2 October after a meeting with Finance Minister Nirmala Sitharaman, but they are still pressing for changes to the government’s proposed merchant discount rate on high-value digital payments.
According to News18, the All India Consumer Products Distributors Federation and the All India Mobile Retailers Association had planned to stop accepting UPI payments for a day to protest the proposed MDR, a fee charged within the payments ecosystem on certain merchant transactions. After talks led by BJP MP Praveen Khandelwal, the two bodies said they were calling off the strike and that they hoped the government would take their concerns into account.
The traders are asking the government to postpone implementation of the charge, arguing that the timing is awkward because the festive season is approaching and business activity is already rising. They also want the threshold for the fee lifted from ₹1 lakh to ₹5 lakh, and they have asked that merchant-to-merchant transactions be excluded from the levy. The associations also want a special committee formed to review the issue and suggest a path forward.
The wider row centres on the government’s new UPI MDR framework, which is due to take effect on 15 October. According to Finance Minister Sitharaman’s earlier comments reported by Livemint, The New Indian Express and Rediff.com, the 0.4% charge on selected person-to-merchant UPI payments above ₹2,000 will be borne by merchants rather than customers, and it is not a tax, cess or surcharge. Those reports said the money will stay within the payments system to support infrastructure and innovation costs, while small merchants receiving up to ₹1 lakh a month through UPI QR codes will remain exempt. Business Standard reported that person-to-person transfers will continue to be free and that the government expects only a small share of merchant transactions to be affected.
The dispute has nevertheless drawn criticism from trade groups. The Chamber of Trade and Industry has urged the government to roll back the planned charge, warning that it could reduce the use of high-value UPI payments and push some buyers back towards cash, according to NDTV. For now, the immediate protest has been shelved, but the underlying concern over the cost of digital payments remains unresolved.
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