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Repair common Windows errors and clear accumulated junk for a smoother, more stable PC - no reinstall needed.Free scan · no reinstallFor Indian merchants, a UPI QR and an online payment gateway are not interchangeable fee categories. The Finance Ministry’s 15 September 2026 announcement sets out merchant discount rate (MDR) rules, while a gateway can charge separate platform fees for its services. The revised rates are announced but not yet in force as of 4 October 2026: a Cashfree guide identifies 15 October 2026 as the start date, so confirm implementation and your classification with your bank or acquirer before budgeting. Ministry of Finance announcement; Cashfree guide to the announced framework.
What MDR is—and what it does not include
MDR is the merchant-side network acceptance charge under the announced framework. It is not the same as a provider’s gateway or platform fee, which may cover services such as hosted checkout, plugins, SDKs, dashboards and reporting. The Ministry says MDR is not a charge on customers and that banks have been advised to prevent it being passed through to them. It describes MDR as “neither a tax nor a charge collected by the Government or NPCI.” Ministry of Finance announcement.
That distinction matters even when MDR is zero: a gateway’s separate fee may still apply under your agreement. Cashfree explicitly identifies its platform fee as separate from payment-instrument charges. Cashfree pricing.
Announced UPI MDR rates in India
The rates below are from the Ministry of Finance release dated 15 September 2026. They should be treated as announced rules, not assumed to be live on 4 October: a provider guide names 15 October 2026 as the start date. Confirm the effective date and how your acquirer will classify transactions before applying these figures to settlements. Ministry release; Cashfree framework guide.
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| Payment or merchant category | Announced MDR | Important qualification |
|---|---|---|
| Person-to-person UPI (P2P) | Zero | Applies to P2P transfers, not a merchant sale. |
| Person-to-merchant UPI (P2M) payment up to ₹2,000 | Zero | Zero MDR under the announced framework; a separate provider fee may still apply. |
| Qualifying small P2PM merchant receiving up to ₹1 lakh per month through UPI QR | Zero on all transactions | Includes merchants such as street vendors, but eligibility and P2PM classification matter. Confirm your status with your bank or acquirer. |
| Standard covered P2M payment above ₹2,000 | 0.4% | Transactions of ₹75,000 and above are capped at ₹300 per transaction. |
| Specified essential or thin-margin sectors above ₹2,000 | ₹5 per transaction | The release names railways, telecommunications, insurance, fuel and agricultural inputs. |
| Covered capital-market payment | 0.02% | Capped at ₹300 per transaction. |
For a standard covered P2M payment of ₹5,000, 0.4% works out to ₹20 in MDR before any separate gateway charge or applicable tax. This is an arithmetic illustration, not a quote or settlement prediction. The Ministry estimates that about 96% of P2M transactions remain unaffected and MDR applies to about 4% of merchant transactions; those are Ministry estimates, not independent audit findings. Ministry of Finance announcement.
QR acceptance versus a payment gateway
A counter QR is designed for an in-person customer to scan and pay. A gateway is generally relevant when you need to accept payment online, though providers may also offer QR or payment-link options. Choosing the format does not, by itself, determine the MDR category: the merchant’s onboarding classification, transaction value and category still matter.
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- In-person counter: A QR issued for your merchant account may be the more direct fit when customers pay at a physical point of sale. Ask the issuer how the QR is classified and how receipts appear in settlement and reconciliation records.
- Website or app checkout: A gateway can provide hosted checkout, plugins or SDKs and related reporting. These services can carry platform pricing separate from MDR.
- Payment link or remote order: Check whether the provider offers links or messaging-based payment flows, and get confirmation of the fees and transaction treatment for that exact flow.
- Dynamic QR: A provider may offer a QR generated for an individual order as part of its gateway tools. Confirm whether it is available for your channel and how its provider fee is charged.
PhonePe lists dynamic QR, checkout and payment links. Cashfree lists UPI QR, intent, collect and WhatsApp-link flows. These are descriptions of available options, not evidence that providers deliver equivalent service quality, success rates or settlement outcomes. PhonePe pricing and features; Cashfree pricing and features.
Published provider pricing: examples, not a like-for-like comparison
Provider pages describe commercial offers and platform fees, not a universal total cost for every merchant or payment. Compare a written quote for the same channel, order value, merchant category and payment instrument; do not treat an advertised promotion as the MDR rate.
| Provider | What its published material says | What to verify |
|---|---|---|
| PhonePe PG | The standard plan page shows a limited-time “Free” offer, zero setup fee and zero annual maintenance fee. Enterprise pricing is personalized. The page says its figures are accurate as of July 2026. | Check the offer’s terms, end date and fees for each payment method. “Free” does not establish your total cost after the offer or for every transaction. |
| Cashfree | The pricing page lists 1.95% standard platform pricing and a promotion for qualifying new merchants up to ₹20 lakh GMV, subject to terms, excluded methods and tax conditions. | Confirm eligibility, the remaining promotion period, exclusions, GST treatment and how any new MDR is shown in your settlement. |
| Razorpay | A provider guide from February 2026 describes a 2% platform-fee example for bank-account UPI and distinguishes platform fees from network MDR. | Verify the current tariff and your contract directly; the example is provider-authored guidance, not a confirmed quote for your account. |
Sources: PhonePe pricing; Cashfree pricing; Razorpay guide to UPI transaction charges.
How to compare your actual total cost
- Confirm the rule and your classification. Ask your bank or acquirer whether your merchant is onboarded in the relevant P2M or qualifying P2PM category, which monthly QR receipts count toward the ₹1 lakh threshold, and how your business category is assigned.
- Describe the payment flow precisely. State whether customers pay at a physical counter, website, app, payment link or generated QR. Include typical order values and expected monthly volume.
- Request a written fee breakdown for that setup. Ask the provider to separate MDR, platform fee, applicable taxes, settlement charges, recurring or mandate charges, and refund treatment where relevant. Ask whether an advertised offer covers the provider fee, network MDR or both.
- Ask for a sample settlement. Have the provider show how deductions for a representative transaction and refund would appear in the settlement statement, including the dates and conditions for settlement.
- Compare operations as well as price. Check integration needs, QR or link support, reporting, reconciliation, support and refund handling. Do not infer equivalent performance from feature lists.
This approach avoids treating a zero-MDR payment as a zero-cost gateway transaction or comparing a promotional platform price directly with the network MDR. Cashfree pricing; Cashfree framework guide.
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What is not established by the announced rate card
The rate announcement does not, on its own, tell an individual merchant which category its acquirer will assign, which provider charges apply under its contract, or how every payment flow will appear in settlement. Nor do the published feature and pricing pages establish a neutral, like-for-like comparison of provider reliability or success rates. Treat the Ministry release as the source for the announced MDR framework and provider materials as descriptions of their own offers; get account-specific terms in writing. The Department of Financial Services lists an MDR FAQ dated 15 September 2026, but the rate table above is based on the Ministry’s release. Department of Financial Services MDR FAQ listing.
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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.
