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September 2026
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FEMA & RBIUPI stays free for person-to-person transfers and merchant payments up to ₹2,000; 0.4% MDR on specified merchant payments above ₹2,000, says Finance Ministry
UPI: 0.4% MDR above ₹2,000ClarifiedThe Ministry of Finance says the new UPI framework under the Payment and Settlement Systems Act, 2007 does not touch person-to-person transfers. Merchant payments up to ₹2,000 and small merchants receiving up to ₹1 lakh a month stay at zero MDR. A 0.4% MDR applies to merchant payments above ₹2,000, capped at ₹300 for ₹75,000 and above; customers are not to be charged.
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