THE UPI MERCHANT FEE MARKS BEGINNING OF MAKING DIGITAL PAYMENTS COSTLIER: KUMARI SELJA

PROPOSED UPI CHARGES MAY RAISE COSTS FOR CONSUMERS, GOVERNMENT SHOULD WITHDRAW DECISION, -UPI WAS PROMOTED AS FREE DIGITAL PAYMENT SYSTEM, WHY INTRODUCE MERCHANT CHARGES NOW?, THE HIGHER BUSINESS COSTS COULD ULTIMATELY BURDEN CONSUMERS THROUGH PRICES:-KUMARI SELJA

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The Sirsa MP, Former Union Minister, General Secretary of All India Congress Committee and CWC Member Kumari Selja said the BJP-led central government first encouraged citizens to adopt digital payments and UPI and was now beginning to turn the same system into a source of revenue. She said the decision to impose a 0.4% Merchant Discount Rate (MDR) from October 15 on certain merchant UPI transactions above ₹2,000 was against the interests of consumers and traders.

Kumari Selja said although the government was describing MDR as a charge imposed on merchants, the additional business cost could eventually reach consumers through higher prices of goods and services.

According to the government, person-to-person UPI transactions, merchant payments up to ₹2,000 and eligible small merchants receiving up to ₹1 lakh in UPI payments per month would remain free. Kumari Selja, however, questioned why a charge was being introduced into a system that had so far been promoted as free and beneficial to the public. She said a merchant would have to pay ₹12 as MDR on a ₹3,000 transaction and ₹200 on a ₹50,000 transaction. Such additional costs, she said, could ultimately have an impact on prices.

Kumari Selja said Leader of Opposition in the Lok Sabha Rahul Gandhi had earlier warned that new provisions could pave the way for charges on UPI. She said his concern now appeared relevant in view of the proposed changes. Gandhi has also questioned whether the move was connected with opening the digital payments sector to US companies or responding to US pressure, she said.

Kumari Selja demanded that the Centre clarify which institutions and companies were consulted before the policy was formulated.

She said the BJP government’s economic model was continuously adding financial pressure on ordinary citizens. Rising costs of cooking gas, petrol and CNG, along with expensive food items, vegetables, sugar and onions, had already affected household budgets, she said. Kumari Selja said Congress had earlier described GST as “Gabbar Tax”, arguing that its complexity and rates had affected small traders and consumers. She alleged that after failing to address unemployment, the government was now looking for ways to generate revenue from digital transactions.

She said small shopkeepers were already dealing with inflation, weak demand, GST compliance and rising operating costs. After the new system comes into effect, some traders could avoid accepting large UPI payments or ask customers to pay in cash, potentially affecting digital-payment adoption. Kumari Selja also sought clarity on how eligible small merchants would be identified and what procedure would apply once their monthly UPI receipts crossed the ₹1 lakh threshold.

She demanded immediate withdrawal of the proposed MDR on merchant UPI payments and said digital payments should remain free. UPI, she said, should remain a tool for public convenience and financial inclusion rather than become a means of collecting charges.