The National Payments Corporation of India (NPCI) does not foresee any major shifts in the pricing policy for UPI Merchant Discount Rate (MDR) and expects transaction volumes and values to remain unaffected, Managing Director and Chief Executive Officer Dilip Asbe said.
Speaking at the SBI Banking and Economics Conclave 2026, Asbe noted that while the overall ecosystem remains resilient, there is a risk that around 10% of merchants could pass on UPI MDR costs to consumers - an issue NPCI will need to examine closely.
Explaining the merchant transaction mix, Asbe pointed out that approximately 75% of merchants do not receive transactions above Rs 2,000, while around 10% do not accept credit card payments, creating the potential friction of charges trickling down to end users.
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At present, 96% of UPI transaction volumes carry zero charges. Asbe reiterated that there is clear long-term value associated with UPI MDR charges and expressed confidence that NPCI will implement the framework successfully. He added that NPCI remains open to stakeholder feedback and will sustain its outreach regarding UPI pricing.
Beyond transaction pricing, Asbe identified credit as a primary engine for the next phase of UPI adoption, stating that expanding credit access could bring substantial numbers of new users onto the platform. He added that reward structures and associated features typically offered on credit cards could also be extended to UPI users.
Looking ahead, NPCI is preparing to deploy its own agentic payments capability within the next few months. While agentic payments are expected to provide meaningful support to small merchants, Asbe emphasised that NPCI will proceed with caution during the technology's rollout.
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