The Tool Desk
Outbyte PC Repair FREERepair Windows errors before they cause bigger problemsFix Now →Outbyte Driver Updater FREEFix the driver behind crashes, sound loss and screen glitchesFind Drivers →As of 7 October 2026, India’s announced UPI MDR schedule is due to take effect on 15 October 2026. For specified merchant UPI payments above ₹2,000, the general rate is 0.4%, capped at ₹300 for transactions of ₹75,000 or more. The Ministry of Finance’s comparison benchmarks are typically 1.5%–2.5% for credit cards and up to 0.90% for debit cards. These are merchant-side acceptance costs—not fees the customer automatically pays.
Is UPI MDR zero, and when does the announced schedule start?
UPI MDR is not universally zero under the announced schedule. The Ministry of Finance says the specified rates begin on 15 October 2026; they are not yet effective as of 7 October 2026. The detailed schedule is in the Ministry’s 15 September 2026 FAQ and PIB release.
Several categories remain at zero MDR: person-to-person (P2P) transfers, person-to-merchant (P2M) payments up to ₹2,000, and qualifying small merchants under the P2PM framework. For the latter, the published eligibility refers to qualifying account categories and receipts of up to ₹1 lakh per month through UPI QR codes. A shop that merely appears small does not automatically qualify.
The Ministry estimates that about 96% of merchant transactions will remain unaffected. That is the Ministry’s estimate, not an independently verified measurement.
#1 Best Overall
- With Square Terminal, you can ring up sales, accept payments, and print receipts, all with one device. Use it at the counter or ring up customers anywhere in your store.
- Accept all major credit and debit cards and pay one low rate with no hidden fees and no long-term contracts.
- Process chip cards in just two seconds.
- Get your money as soon as the next business day.
- Use it cordlessly with the built-in battery, designed to last all day.
What is the UPI MDR above ₹2,000?
The announced rate depends on the merchant’s transaction category. These are merchant-side rates under the Ministry’s schedule, not customer surcharges.
| UPI payment category | Announced MDR | Scope |
|---|---|---|
| P2P transfer | Zero | Remains free under the published framework. |
| P2M transaction up to ₹2,000 | Zero | Includes transactions at established commercial merchants. |
| Eligible P2PM small merchant | Zero | Eligibility is account-category based and includes the published monthly receipt limit; not every small-looking shop qualifies. |
| Specified general P2M transaction above ₹2,000 | 0.4%, capped at ₹300 | The ₹300 cap applies to transactions of ₹75,000 and above. |
| Specified essential or thin-margin sectors above ₹2,000 | ₹5 flat | The Ministry names railways, telecommunications, insurance, fuel, and agricultural inputs. |
| Specified capital-market payments | 0.02%, capped at ₹300 | Applies to the capital-market categories specified in the Ministry FAQ. |
At the general 0.4% rate, a ₹3,000 eligible payment produces ₹12 MDR, and a ₹50,000 payment produces ₹200. At ₹75,000 or more, the fee reaches the ₹300 cap. These calculations describe the merchant’s fee, not an extra amount added to the payer’s bill.
Rank #2
- An intuitive interface to easily accept payments and manage your sales.
- Strong, reliable Wi-Fi connection. Free SIM card and mobile data so you can process payments anywhere.
- Great battery capability with an additional charging station.
- A truly portable device. Stay in control of your business, wherever you go.
- Support when you need it. Get in touch with our US-based support through phone, email and chat.
How much does a debit or credit card cost a merchant?
The Ministry’s FAQ gives broad benchmarks rather than one rate applicable to every merchant: standard credit-card MDRs typically range from 1.5% to 2.5% per transaction, while debit-card MDR is capped up to 0.90%. The actual rate depends on the merchant’s category, card type and acquiring terms. See the Ministry of Finance FAQ.
A dated, bank-specific example shows why a single card rate can mislead. Indian Bank’s PoS schedule effective 1 September 2024 lists the following rates; it is not a current quote for every bank or merchant. The bank states that GST is charged on MDR.
Rank #3
- Includes Elavon encryption
- Chip Card / EMV / NFC Compatible
- 2.4’’ Color LCD with backlight
- 192 MB of Memory (128 MB RAM / 64 MB DDR RAM)
- Includes terminal and power supply
| Indian Bank PoS card category | Published MDR | Qualification |
|---|---|---|
| Visa/Mastercard debit, small merchants | 0.40%, capped at ₹200 | Indian Bank schedule effective 1 September 2024. |
| Visa/Mastercard debit, other merchants | 0.90%, capped at ₹1,000 | Indian Bank schedule effective 1 September 2024. |
| Credit, standard | 1.75% | Indian Bank schedule effective 1 September 2024. |
| Credit, premium | 2.20% | Indian Bank schedule effective 1 September 2024. |
| Credit, super-premium, international, prepaid or commercial | 2.60% | Indian Bank schedule effective 1 September 2024. |
The same Indian Bank schedule lists zero MDR for RuPay debit and UPI QR PoS. Those are terms in that bank’s published schedule, not evidence that every card acceptance arrangement has identical rates.
How should merchants compare UPI, debit and credit costs?
Compare like with like: the same merchant, payment amount, acceptance channel and card category. A percentage alone can hide a cap, flat fee or eligibility condition. The announced general UPI rate is below the Ministry’s typical credit-card benchmark and debit-card cap, but the result for a particular merchant depends on which UPI category applies and on the merchant’s actual card-acquiring contract.
Rank #4
- The Clover Compact and Clover Mini /Station sync with each other through the Clover Dashboard and cloud-based network. This allows you to manage transactions, track sales, and access business data across both devices seamlessly. Plug in, not battery/mobile. Requires New Processing account through Powering POS. (US, PR, USVI). CANNOT be used with a different Processor. Rate match guarantee. Contact us for questions
- Check the transaction category: establish whether the UPI payment is general P2M, an essential-sector payment, a capital-market payment, or a zero-MDR category.
- Include fee mechanics: compare percentage rates alongside per-transaction caps or flat charges.
- Check the card agreement: card costs vary by card type, merchant category and acquiring arrangement. RBI directed acquiring banks to unbundle MDR for debit, credit and prepaid categories and to improve clarity in merchant agreements. See the RBI direction of 1 September 2016.
- Keep tax separate: Indian Bank’s 2024 schedule says GST is charged on its MDR; confirm applicable treatment in the merchant’s own agreement and bill.
- Separate merchant cost from payer cost: MDR is an acceptance cost in the payment ecosystem, not automatically an amount collected from the customer.
Who pays UPI MDR: the merchant or the customer?
The Ministry says MDR is paid within the merchant payment ecosystem and is neither a government tax nor a charge collected by the Government or NPCI. It also says UPI customers will not pay the announced MDR, and banks have been advised against merchants passing it on. The merchant’s card acceptance rate is a separate contract-cost question. Read the 15 September 2026 PIB release.
Credit-linked UPI is a separate case. The Ministry FAQ treats RuPay credit cards linked to UPI and pre-sanctioned credit lines under credit-product rules, so they should not be grouped with direct account-to-account UPI in this comparison.
Best Value
- With Square Handheld, you can accept payments, take tableside orders, or scan barcodes anywhere. With a slim design and comfortable grip, the POS is easy to carry in your palm or pocket. Square Handheld is designed to withstand water splashes and dust. Add an optional protective case for accidental drops. A long-lasting battery and offline payments let you keep selling.
- Slim, pocketable, and lightweight so you can accept payments wherever your customers are.
- Take tableside orders, bust lines, or use the built-in barcode scanner, all with one sleek device.
- A battery that can power through your shift and offline payments let you keep selling, even if your internet is down.
- Accept all major credit and debit cards and pay one simple rate with no hidden fees and no long-term contracts required.
Why older statements about UPI charges may differ
A Ministry answer to the Lok Sabha on 18 August 2025 said there was then no proposal to impose UPI transaction charges and described the earlier zero-MDR framework. The Ministry’s more specific September 2026 schedule came later and sets a future effective date. The 2025 answer is historical context, not the current announced schedule. See the Lok Sabha answer of 18 August 2025. The Ministry’s 8 August 2026 release had previewed a limited, threshold-based approach; the September FAQ and release supplied the specific rates and start date. See the 8 August 2026 PIB release.
Quick Recap
Product prices and availability are accurate as of the date/time indicated and are subject to change. Any price and availability information displayed on Amazon at the time of purchase will apply.
