Retailers Warn UPI Fees May Drive Small Traders to Cash
· Business · PTI, Hindustan Times, NDTV
Retailers have expressed concern that the newly introduced Merchant Discount Rate (MDR) on UPI transactions could discourage small traders from using digital payment methods. Industry representatives suggest that the added costs, even if applied to larger transactions, may prompt a shift back toward cash payments ahead of the festive season. The government recently announced a 0.4% fee for person-to-merchant UPI payments over Rs 2,000, excluding micro-merchants. Traders argue that the timing of this policy change creates a burden during a period typically marked by high transaction volumes. The long-term impact on digital payment penetration among small-scale businesses remains to be seen.
Why it matters
The shift toward cash payments by small traders could reverse gains in digital financial inclusion and complicate tax compliance for the retail sector.
Read the original report — PTI
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