UPI Charges in India (2026)
Short answer
For ordinary users, UPI remains free: person-to-person transfers carry no charge, and merchant payments up to ₹2,000 carry no charge. Where a charge does apply on larger specified merchant payments, it is MDR — paid in the merchant acceptance chain, not a government tax on you.
Last updated: 16 September 2026Last verified: 16 September 2026Applicable from: 2026
MDR is a charge, not a tax
MDR (Merchant Discount Rate) is what a merchant pays for accepting a digital payment. It is not income tax, GST or TDS, and it is not collected by the government from the person sending money.
UPI charges at a glance
| Payment | Who pays | Charge position |
|---|---|---|
| P2P transfer (person to person) | Nobody | Free under the current framework, at any amount |
| Merchant payment up to ₹2,000 | Nobody | Free |
| Specified merchant payment above ₹2,000 | Merchant | MDR framework applies — verify the rate and cap in the latest NPCI circular |
| Eligible small merchants | Nobody | Can remain outside MDR under the zero-MDR framework |
| Special categories (railways, fuel, utilities, insurance, tax payments) | Varies | Separate treatment — verify with your bank or the NPCI circular |
✓ Official source — NPCI UPI circulars · View · Verified 16 September 2026
Charges you might actually see
- Convenience or platform fees charged by an app or biller — separate from UPI itself.
- Bank charges on non-UPI rails such as NEFT, RTGS and IMPS.
- Card interest or late fees when a UPI credit line is used.
- Merchant-side MDR, which the merchant may or may not build into prices.
Estimate a merchant charge
Use the UPI charges calculator to work out an indicative MDR figure for a given amount and payment type, then confirm the applicable rate with your acquiring bank.
Related pages
This page is educational information, not professional tax, legal or financial advice. Rules can change — verify against the latest official notification or consult a qualified professional before acting.