A National Traders' Welfare Board (NTWB) member has requested the Center to immediately reverse its decision to apply a 0.4% merchant discount rate (MDR) on UPI transactions above Rs 2,000, citing potential harm to companies and consumers.
Madhya Pradesh's representative on the government-established NTWB, Ramesh Khandelwal, stated that the tax might have a negative impact on business expansion and ultimately result in higher pricing.
"The government's goals about ease of doing business are in conflict with the decision to impose MDR on UPI transactions. Khandelwal told PTI, "This will affect business growth and may result in higher prices."
In the greater good of businesses and consumers, he urged the Center to reverse the ruling.
Additionally, Khandelwal stated that he would bring up the subject of imposing MDR on UPI transactions at the next NTWB meeting.
The NTWB was established by the Department for Promotion of Industry and Internal Trade (DPIIT) to assist the central government on a range of welfare initiatives for traders and their staff.
Nearly six years of completely free UPI payments have ended as a result of the Center's decision. Person-to-person transfers and smaller merchant payments will continue to be free, however merchant transactions over Rs 2,000 made through UPI will be subject to a 0.4% fee starting on October 15.
The new framework states that merchants, not customers, will be responsible for paying the fee. Additionally, transactions of Rs 75,000 or more would have a cap of Rs 300.
UPI transfers between individuals and commercial transactions up to Rs 2,000 will stay free.
