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NPCI Postpones UPI Merchant Fee Implementation Till Diwali 2026
Reported by Manish Reddy (Senior Writer) · Livemint - Markets ·
Confirmed by a second source: Business Standard - Top Stories
Big decision! UPI MDR fee deferred till Diwali; check impact on Paytm, Pine Labs, One Mobikwik, Moneyview, Zaggle shares. Stock market today: In a major move towards UPI MDR implementation in India, the NPCI today announced that the decision has been delayed until Diwali 2026. After the announcement, fintech stocks — Paytm , Pine Labs , PB Fintech, Groww, Mobikwik witnessed a strong rebound from today's lows. The NPCI declared about the delay in the UPI MDR fee implementation, saying, "UPI and Services Steering Committee today decided that keeping in mind the festival season, Merchant Discount Rate (MDR), on select Person-to-Merchant (P2M) UPI transactions, shall be implemented immediately post Diwali at a date
ExplainerWhy this matters
What Happened
The National Payments Corporation of India delayed its planned Merchant Discount Rate charges on business UPI payments until after Diwali 2026, granting a temporary relief period for fintech platforms and merchants during the peak festival buying season.
Why It Matters
The introduction of MDR shifts the cost of processing digital payments onto merchants, which raised concerns that businesses would raise retail prices to protect their profit margins. This means everyday shoppers could indirectly bear the cost through higher goods prices even on small purchases, potentially impacting public adoption of UPI.
What Happens Next
Regulators and industry stakeholders are expected to review and potentially tweak the proposed framework based on technical feedback, such as the warnings raised in the IIT Bombay-associated report, before the revised fee rules take effect after Diwali 2026.
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