22/4/2025, 11:02:03 am

Real cost of UPI, missing revenue model, and a case for bringing back MDR

UPI has grown significantly, processing 18 billion transactions monthly, driven by a zero-Merchant Discount Rate (MDR) policy. However, the government's reduced subsidy for UPI transactions has sparked concerns about sustainability. A proposed 25bps fee on large merchants aims to support infrastructure and stability, ensuring the ecosystem's continued growth and efficiency.