Neelkanth Mishra says allowing a Merchant Discount Rate (MDR) on UPI payments is unlikely to cause a large-scale rise in fees because payment firms compete with one another. That is his forecast—not an announced fee schedule, a guarantee that no merchant will pay more, or a stated World Bank policy position.
What Mishra said about UPI fees
In an interview on the sidelines of the 5th Kautilya Economic Conclave in New Delhi, reported by IANS on 3 October 2026, Mishra—identified in the report as an Executive Director at the World Bank Group—called MDR an enabling provision. He said he did not expect it to lead to a large-scale increase in fees, describing the market as free and competitive. IANS’s interview report
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His point is about the likely effect of permitting a fee, not evidence that a new fee has taken effect or that every payment provider will set the same charges.
Why he expects competition to restrain broad increases
Mishra’s reasoning is that banks, financial firms and payment aggregators compete for business, which would make widespread fee increases harder to sustain. He also said firms had remained viable when they could not charge MDR. In his words: “I don’t see this leading to a large-scale increase in fees because it is a free and competitive market.” IANS’s interview report Related report
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That is a qualitative argument, not a guarantee. The interview report does not supply independent market data showing that competition will prevent every price rise, coordination among providers, or the passing of costs on to merchants.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.What MDR means for merchants
MDR is a fee charged to merchants for processing digital payments. A secondary report says MDR on UPI and RuPay was waived in 2020; that is reported background, not a complete account of the current law. Background report on UPI MDR
Whether a fee is legally permitted and whether a provider actually charges it are separate questions. The cited reports do not establish a current UPI MDR rate, which merchant categories or transaction thresholds might be covered, or an implementation date. They therefore do not support a claim that merchants currently owe a particular UPI fee.
Quick Recap
What merchants and customers should take from the forecast
- For merchants: Mishra’s remarks suggest he expects competition to limit broad fee increases, but they do not tell you what your payment provider will charge. Check the terms directly with your provider before making cost assumptions.
- For customers: The remarks do not announce a new consumer fee or establish that customers will be charged for UPI payments.
- For the policy question: Treat this as Mishra’s assessment of a possible market response, not as confirmation of a rule change or a verified outcome.
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