MDR Debate Linked to 2026 Tax Bill; UPI Remains Free for Consumers

The discussion around a possible Merchant Discount Rate gained momentum after the government tabled the Taxation and Other Laws (Amendment) Bill 2026. The bill gives the centre legal authority to review the current zero‑MDR framework for digital payments.

Importantly, the legislation does not impose any new charge on users. It merely creates a provision that could allow a future review of the policy, should the need arise. Until Parliament passes the bill and the UPI and Services Steering Committee, headed by NPCI, examines the issue, the existing fee‑free structure stays intact.

Stakeholders, including banks and fintech companies, are watching the process closely, as any shift could affect the pricing model for merchant transactions across the country.