India, March 25 -- UPI's MDR Debate Heats Up Again

Fintech startups have again voiced concerns over the zero MDR regime for UPI payments. Caught between increasing deployment costs and compliance expenses, industry stakeholders have sought Prime Minister Narendra Modi's intervention on the policy that was introduced to promote the UPI ecosystem.

But, Why The Sudden Outburst? Last week, the union cabinet cleared an INR 1,500 Cr scheme to incentivise BHIM and UPI transactions (under INR 2,000) for FY25, which is already 60% lower than FY24's outlay of INR 3,500 Cr.

According to the Payments Council of India (PCI), the allocation of INR 1,500 Cr is insignificant compared to the INR 10,000 Cr needed annually to sustain and grow UPI service...