‘No UPI Day’ on October 2? Mobile vendors protest 0.4% MDR proposal on payments | Today’s news
Mobile phone vendors across the country have decided to stop accepting UPI payments on October 2 as part of a nationwide protest against the proposed 0.4% merchant discount rate (MDR) on certain business transactions, news agency PTI reported.
Organized by the All India Mobile Retailers Association (AIMRA), the protest will see retailers mark Gandhi Jayanti as ‘No UPI Day’ to raise concerns over the additional cost of accepting digital payments.
Why are mobile sellers protesting?
UPI transactions above 0.4 percent will be charged ₹2,000 for merchants from October 15. Transactions between individuals will not be charged, while small value merchant payments will also remain exempt.
AIMRA vice-president and Delhi-NCR president Tarvinder Singh said the association chose October 2 for the protest to highlight the concerns of mobile vendors.
“The All India Mobile Retailers Association (AIMRA) has called for a ‘NO UPI DAY’ on October 2, 2026 to address the concerns of mobile retailers regarding the 0.4% merchant discount rate (MDR) applicable on eligible UPI merchant transactions,” Singh said, according to news agency PTI.
What will traders be doing on October 2?
Retailers participating in the campaign will temporarily stop accepting UPI payments on October 2. They will also cover their UPI QR codes with black cloth to show their opposition to the proposed MDR.
The association has separately written to Finance Minister Nirmala Sitharaman, warning that the proposed levy could put further pressure on the income of small retailers.
Read also | UPI MDR: Where will the 0.4% fee go? What did FM say? Check the schedule
Based on AIMRA calculations, a retailer processing UPI transactions in value ₹5,00,000 every month may face an additional cost of approx ₹2000. For retailers processing up to ₹30 lakh through UPI every month, the monthly impact could rise to ₹12,000.
The association argued that such costs could take a significant share of the revenue of smaller mobile retailers.
What is the requirement of AIMRA?
AIMRA has called for UPI merchant payments to continue under the existing zero-rate MDR structure. Singh said the association’s campaign should not be seen as opposition to UPI or the government’s push for digital payments.
“If we want a Digital India, UPI must remain zero MDR. This is not a protest against UPI or Digital India. Our concern is the additional financial burden imposed on merchants who accept digital payments. If we want Digital India to grow further, digital payments should remain available to the entire retail ecosystem. Our clear demand is that UPI merchant payments continue under a zero MDR structure,” Singh was quoted as saying by PTI.
Read also | UPI is accepted in 11 countries: Will MDR charges apply globally?
The new MDR framework has faced a legal challenge, with the Supreme Court scheduled to hear the case on Monday.
A public interest litigation (PIL) filed by advocate Anjan Datta alleges that the fee was introduced without adequate legal safeguards, transparency or public consultation.
UPI MDR revenue: Who gets 0.4% fee?
Under the new framework, 40 percent of MDR collections will go to customer banks, 30 percent to payment gateways, 20 percent to the UPI app and the remaining 10 percent to the sponsoring bank of the UPI app.
The revenue sharing structure is different because UPI transactions have historically operated without a conventional transaction fee. The new model is intended to provide a financial framework for maintaining and expanding the payment infrastructure.
Sitharaman said the government will not receive the money collected through the MDR.
“This is not a tax, it is not a cess, it is not a surcharge. And the collection does not go to the Consolidated Fund of India.”
The government said the MDR is a payment ecosystem fee rather than a government fee, with revenues shared between participating financial institutions and payment service providers.
(With inputs from news agency PTI)
