UPI charges may partially offset loss on credit card MDR: RBI paper

There is a possibility that fees levied on credit card transactions may eventually come down, either through central bank intervention or otherwise. And the reintroduction of charges on Unified Payments Interface (UPI) may, perhaps, offset the impact of fee reduction in cards for banks, industry participants said.

That said, the Reserve Bank of India (RBI) has not taken any stance now so the overhang on merchant discount rate (MDR) would continue till the time it comes out with final guidelines, they said.

MDR is the rate charged to a merchant for payment processing services on various payment instruments.

The RBI’s discussion paper on charges in payment systems,