CHANDIGARH — Union Finance Minister Nirmala Sitharaman has strongly clarified that charges associated with UPI transactions—particularly regarding Merchant Discount Rate (MDR) discussions—will not be passed on to everyday consumers. Speaking to the media, the Finance Minister addressed ongoing political debates and public concerns, asserting that misinformation is being deliberately circulated to mislead the public and criticize the government.

Understanding the Charges: Not a Tax or Cess

Addressing confusion surrounding UPI transaction fees, Sitharaman clarified that the charges under debate are not taxes or cesses, nor do they go into the Consolidated Fund of India .

Instead, she explained:

• Service Provider System Improvements: The charge is strictly a mechanism between operators and service providers to maintain, upgrade, and enhance the overall efficiency of the payment infrastructure.
• Exemption for Small Transactions: Transactions below ₹2,000 are entirely free of such charges.
• Zero Burden on End Users: The Finance Minister emphasized that these backend charges operate strictly between operators and will never be levied on individual customers or consumers.

Calling Out Misinformation and Political Narrative

Sitharaman pointed out that this issue had already been thoroughly clarified during Parliament sessions. She expressed concern that constant discussions based on incomplete or incorrect information have become a habitual tactic for the opposition.

• Deliberate Misunderstandings: The Finance Minister noted that twisting technical processing fees into a narrative of consumer taxation is an ongoing effort to misinform citizens.
• Call for Vigilance: Urging citizens to remain vigilant, she cautioned the public against falling prey to rumors and unfounded panic regarding digital payments.

Bottom Line

The debate over UPI processing fees has sparked widespread discussion, but the official stance remains unequivocal: digital transactions remain secure, user-friendly, and free of direct charges for everyday consumers.