Supreme Court refuses to stay MDR on UPI payments, but questions Centre over move: 'What is it?'

The Supreme Court on Monday refused to stay Centre's decision to impose MDR on specified UPI person-to-merchant transactions of over ₹2,000 from October 15.

The top court, however, sought responses from Centre and others on plea challenging imposition of MDR on UPI payments above ₹2,000.

Centre told the Supreme Court that 96 per cent people using gateway are exempt.

Issue is less legal and more technical, observed the Supreme Court, directing Centre, others to file their counter affidavit within four weeks.

The central government, earlier this month, announced a new UPI framework under which UPI payments of over ₹2,000 would attract a merchant discount rate (MDR) of 0.4 per cent.

The government has maintained that there will be no impact on any person to person transactions. UPI will continue to remain completely free for all person-to-person transactions, irrespective of the amount transferred, according to the government.

The government had said approximately 96 per cent of all P2M transactions will remain unaffected.