New Delhi: Digital payments in India have seen a surge during the festive season. The total amount of transactions through the Unified Payments Interface (UPI) in October increased by 16 percent year-on-year to ₹31.53 lakh crore. The number of UPI transactions during this period also increased by 23 percent to 25.47 billion. This information was revealed in data released by the National Payments Corporation of India (NPCI) on Sunday.
According to NPCI data, an average of approximately 822 million transactions were processed daily through UPI in October, with the average daily transaction amount being approximately ₹1,01,707 crore.
Earlier, in September, the number of UPI transactions had increased by 23 percent year-on-year to 24.07 billion. Meanwhile, the total value of transactions during this period increased by 18 percent to ₹29.37 lakh crore.
Transactions through IMPS also increased
In October, the amount of transactions through the instant fund transfer service IMPS increased by 19 percent year-on-year to ₹7.63 lakh crore. According to NPCI data, an average of 1.21 crore transactions were processed daily through IMPS last month. The average daily transaction amount was ₹24,601 crore.
Decision to implement MDR on UPI transactions postponed
Meanwhile, NPCI had postponed the decision to implement the Merchant Discount Rate (MDR) on select UPI merchant transactions until after Diwali. This was intended to provide temporary relief to merchants and consumers during the festive season.
NPCI had stated that its UPI and Services Steering Committee had decided to extend the date for implementing the MDR system keeping in mind the festive season. It was originally scheduled to be implemented on October 15th. However, the new date will be announced separately at a later date.
Which UPI transactions may be subject to MDR charges?
Under the proposed MDR system, a flat MDR charge of ₹5 is proposed for UPI payments exceeding ₹2,000 for select merchant categories such as railways, telecom services, insurance, and fuel purchases.
Large merchants are proposed to be charged a 0.4 percent fee for payments exceeding ₹2,000. However, this fee is capped at ₹300 per transaction.
NPCI maintains that the revised MDR system will have limited impact on the broader UPI ecosystem. According to previously shared estimates, only about 4 percent of merchant transactions will be covered by this new system. At the same time, MDR charges will continue to be waived on more than 95 percent of person-to-merchant (P2M) UPI transactions.