# UPI fee could recover up to Rs 15,000 crore annually

> NPCI chief says 0.4% UPI fee may recover ₹13,000-15,000 crore yearly without charging customers.
- Title: UPI fee could recover up to Rs 15,000 crore annually
- Summary: NPCI chief says 0.4% UPI fee may recover ₹13,000-15,000 crore yearly without charging customers. NPCI plans to charge 0.4% merchant fee on UPI transactions…
- Keywords: upi, npci, merchant discount rate, digital payments, india, rs 15000 crore, payment ecosystem, fee, recover, 000, crore, annually
- Source: The Economic Times — https://economictimes.indiatimes.com/industry/banking/finance/upi-fee-could-recover-up-to-rs-15000-crore-annually-while-keeping-most-transactions-free/articleshow/134467670.cms
- Author: ET Bureau
- Published: 2026-09-24T17:32:00+00:00
- Read time: 1 min
- Topics: upi, npci, merchant discount rate, digital payments, india, rs 15000 crore, payment ecosystem
## NPCI proposes 0.4% UPI fee
NPCI chief Dilip Asbe said the proposed 0.4% merchant discount rate on UPI transactions could recover ₹13,000-15,000 crore annually in the first year.

> the proposed 0.4% merchant discount rate (mdr) on unified payments interface (upi) transactions could help recover ₹13,000-15,000 crore of the payment system's estimated ₹21,000 crore annual cost in its first year
## Most transactions remain free
96% of UPI transactions and 75% of transaction value would stay outside the fee framework, keeping most transactions free.

> 96% of u p i transactions and 75% of transaction value would remain outside the mdr framework
## Fee burden minimal for small businesses
The levy won't burden small businesses or customers significantly, as 80% of the fee pool comes from merchants already using credit cards.

> about 80% of the mdr pool would come from merchants that already accept credit cards and pay similar charges
## Fee recovery targets market growth
NPCI aims to recover ₹13,000-15,000 crore to incentivize market players to reinvest and grow UPI.

> we thought r s 13 000 to 15 000 crore could be a reasonable value in year one to recover from the ecosystem
## Reinstating fees after six years
Reintroducing fees after six years of zero MDR would cause pain but is necessary as UPI growth and investments slow.

> reinstating charges after six years of zero mdr would cause some pain but it has become necessary as investments and u p i growth slow
## Key takeaway

NPCI plans to charge 0.4% merchant fee on UPI transactions to recover ₹13,000-15,000 crore annually while keeping most transactions free.