UPI Fee Calculator
Calculate applicable UPI merchant charges and MDR. See how much the merchant pays and keeps.
MDR is settled between the merchant and its acquiring bank. Merchants cannot pass it on to you, and UPI apps cannot add a platform fee of their own.
The framework takes effect on 15 October 2026. Until then, UPI merchant payments carry no MDR at any amount. Nothing you type here leaves your device.
How UPI MDR is calculated
Merchant Discount Rate is what a merchant pays its acquiring bank for accepting a payment. It comes out of the settlement, so the merchant banks slightly less than the amount on the bill. Cards have worked this way for decades. UPI merchant payments above ₹2,000 join them from 15 October 2026.
For a standard merchant the sum is short. Take the transaction value, apply 0.4%, and stop at ₹300:
if amount ≤ ₹2,000 → MDR = ₹0
otherwise → MDR = min(amount × 0.4%, ₹300)
The ₹300 cap starts at ₹75,000 because 0.4% of ₹75,000 is exactly ₹300. From ₹75,000 onwards a larger payment does not increase the MDR beyond that cap.
Capital market payments use 0.02% with the same ₹300 ceiling. The specified essential sectors skip percentages altogether and pay a flat ₹5 above ₹2,000.
Who pays UPI MDR?
The merchant does, to its acquiring bank. That is the whole answer, and it is worth being blunt about because the opposite claim spread widely when the framework was announced.
UPI is still free for you. Consumers are not charged for UPI payments, and UPI apps are not allowed to add a platform fee or any other charge. Merchants cannot pass MDR on to customers, and banks have been told to enforce that. You pay the posted price.
MDR is also not a tax. The Ministry of Finance has stated that it is neither a tax nor a charge collected by the government or by NPCI. It is shared among the parties that run UPI: banks, payment service providers and UPI app providers.
Latest UPI MDR rules
The rules below are the ones this calculator implements, taken from the official FAQ and press release dated 15 September 2026.
Free below the threshold
Merchant payments up to ₹2,000 carry no MDR. A payment of exactly ₹2,000 is still free.
0.4% above it
Standard merchant payments above ₹2,000 carry 0.4%. The government expects that to touch about 4% of merchant transactions.
Capped at ₹300
From ₹75,000 upward the charge stops climbing, whatever the transaction size.
Small merchants stay at zero
The P2PM tier covers merchants receiving up to ₹1 lakh a month through UPI QR. Staying above that for 3 consecutive months moves them to P2M.
Flat ₹5 in essential sectors
Railways, telecom, insurance, fuel, agricultural inputs, electricity distribution, municipal water charges and piped natural gas, all above ₹2,000 only.
0.02% in capital markets
Mutual funds, securities, SEBI-registered brokers, dealers and investment platforms, capped at ₹300.
Mandates are outside it
UPI AutoPay and UPI Mandates do not carry the prescribed MDR, so recurring SIPs, subscriptions and utility auto-debits are unaffected.
Credit-linked UPI is priced separately
RuPay credit cards on UPI and pre-sanctioned credit lines follow credit product rules, not the rates on this page.
UPI charges by transaction type
| Transaction type | MDR | Detail |
|---|---|---|
| Person to person (P2P) | No MDR | Free for sender and receiver at any amount, including self-transfers. |
| Merchant payment up to ₹2,000 | No MDR | More than 95% of UPI merchant transactions by volume sit here. |
| Standard merchant payment above ₹2,000 | 0.4% | Capped at ₹300 from ₹75,000 upward. |
| Small merchant on the P2PM tier | No MDR | Up to ₹1 lakh a month received through UPI QR, at any transaction size. |
| Specified essential sector | Flat ₹5 | Above ₹2,000 only. Railways, telecom, insurance, fuel, agricultural inputs, electricity distribution, municipal water charges and piped natural gas. |
| Capital market payment | 0.02% | Capped at ₹300. Mutual funds, securities, brokers, dealers and investment platforms. |
| UPI AutoPay or recurring mandate | No prescribed MDR | Standing instructions such as SIPs, OTT plans and utility auto-debits. |
| Credit-linked UPI | Separate credit rules | RuPay credit card on UPI and pre-sanctioned credit lines are priced as credit products. |
Person to person transfersAlways free
Free for both sides, at any amount. Paying a friend back, sending money home, splitting a bill and moving money between your own linked accounts all carry no MDR, and no transaction fee or platform fee may be charged on them either. Person to person transfers are 70% of UPI transaction value, and all of that sits outside the MDR framework.
Small merchants on the P2PM tierAlways free
Zero MDR on every transaction, for small vendors taking up to ₹1 lakh a month through UPI QR straight into their own account. A single payment above ₹2,000 does not change that, because MDR here follows the merchant's account category rather than the size of one payment.
The threshold is monthly. A merchant whose UPI inward credit stays above ₹1 lakh a month for 3 consecutive months moves into the P2M category, and the rates above apply from then on. GST registration is not needed to qualify, and existing QR codes keep working.
UPI AutoPay and mandatesNo prescribed MDR
A standing instruction does not carry the prescribed MDR. That covers monthly utility bills, OTT subscriptions and recurring investments set up to debit on their own. Paying the same biller by hand is an ordinary merchant payment, so the rates above apply to that.
Credit-linked UPIPriced elsewhere
This one is not free. A RuPay credit card linked to UPI, or a pre-sanctioned bank credit line, is funded by a short-term loan from the issuing bank, so it follows credit card guidelines rather than the rates on this page. The MDR in this framework applies to money moving straight from a user's bank account to the merchant's account, and your acquiring bank can tell you what a credit-linked payment costs your category.
UPI fee calculator examples
Worked examples at the amounts people ask about most. Each row is produced by the same engine the calculator above runs.
| Scenario | Amount | Applicable MDR | MDR | Merchant receives |
|---|---|---|---|---|
| Grocery bill, standard merchant | ₹1,800 | No MDR | ₹0 | ₹1,800 |
| Restaurant bill, standard merchant | ₹3,000 | 0.4% | ₹12 | ₹2,988 |
| Electronics purchase | ₹10,000 | 0.4% | ₹40 | ₹9,960 |
| Furniture order | ₹50,000 | 0.4% | ₹200 | ₹49,800 |
| Large appliance order | ₹75,000 | 0.4% | ₹300 | ₹74,700 |
| High-value purchase | ₹1,00,000 | 0.4% | ₹300 | ₹99,700 |
| Street vendor on the P2PM tier | ₹3,000 | No MDR | ₹0 | ₹3,000 |
| Petrol pump refill | ₹5,000 | Flat ₹5 | ₹5 | ₹4,995 |
| Annual insurance premium | ₹50,000 | Flat ₹5 | ₹5 | ₹49,995 |
| Mutual fund purchase | ₹50,000 | 0.02% | ₹10 | ₹49,990 |
| Equity order through a broker | ₹10,00,000 | 0.02% | ₹200 | ₹9,99,800 |
| Monthly SIP on UPI AutoPay | ₹10,000 | No prescribed MDR | ₹0 | ₹10,000 |
| Money sent to family | ₹50,000 | No MDR | ₹0 | ₹50,000 |
Frequently asked questions
- Do I have to pay a UPI fee as a customer?
No. UPI stays free for you. The government has been explicit about this: consumers are not charged for UPI payments, and UPI apps are not allowed to add a platform fee or any other charge on top.
MDR is settled between a merchant and its acquiring bank. It never appears on your side of the transaction.
- What is UPI MDR?
Merchant Discount Rate is what a merchant pays its bank for accepting a digital payment. It is deducted from the settlement, so the merchant receives slightly less than the sticker price.
Card payments have worked this way for decades. UPI merchant payments above ₹2,000 join them from October 2026, at a rate well below card MDR.
- When does the new UPI MDR framework start?
15 October 2026. Until then nothing changes, and UPI merchant payments carry no MDR at any amount.
The gap between the September announcement and the October start date is there to give acquiring banks, payment aggregators and billing systems time to update.
- What is the UPI MDR above ₹2,000?
0.4% of the transaction value, for a standard merchant. It applies only to the part of the market above ₹2,000, which the government puts at roughly 4% of merchant transactions.
The charge is capped at ₹300 a transaction from ₹75,000 upward.
- What is the UPI MDR on ₹5,000?
₹20 for a standard merchant: ₹5,000 × 0.4%. The merchant receives ₹4,980 and the customer still pays ₹5,000.
If the same ₹5,000 goes to a P2PM small merchant, or to a petrol pump or an insurer, the answer is different. Run it through the calculator with the right category.
- What is the UPI MDR on ₹10,000?
₹40 for a standard merchant, which is ₹10,000 × 0.4%. The merchant is settled ₹9,960.
- What happens at ₹75,000?
The cap takes over. 0.4% of ₹75,000 is exactly ₹300, and that is where the charge stops climbing.
So a ₹1 lakh payment costs the merchant ₹300, not ₹400. A ₹10 lakh payment also costs ₹300. Because the rate and the cap meet at the same point, there is no jump in the curve.
- Do UPI charges apply to P2P transfers?
No. Sending money to a friend, paying a family member back, splitting a bill or moving money between your own linked accounts stays free, whatever the amount, for both sides.
P2P is roughly 70% of UPI value and sits entirely outside the MDR framework.
- Do small merchants pay UPI MDR?
No, not if they are on the P2PM tier. Street vendors, tea stalls and neighbourhood shops receiving up to ₹1 lakh a month through UPI QR into their own account stay at zero MDR on every transaction.
A single payment above ₹2,000 does not change that. MDR follows the merchant's account category, not the size of one payment.
- What is P2PM?
Person-to-Person-Merchant is an NPCI account category for small vendors who take payments straight into a personal bank account rather than through a full merchant acquiring setup.
The threshold is ₹1 lakh of UPI inward credit a month. A merchant who stays above it for 3 consecutive months is moved to the P2M category, and the standard rules apply from then on. GST registration is not needed to qualify for P2PM.
- Are UPI AutoPay payments charged MDR?
No. Automated recurring standing instructions, that is UPI Mandates and UPI AutoPay, do not carry the prescribed MDR. That covers monthly utility bills, OTT subscriptions, recurring investments and insurance instalments set up as mandates.
Paying the same biller manually is a normal merchant payment, so the usual rules apply there.
- What is the UPI MDR for capital market payments?
0.02%, capped at ₹300 a transaction. It covers mutual funds, securities, SEBI-registered stockbrokers, dealers and investment platforms, including equity purchases, debt market investments and broker wallet top-ups.
On a ₹50,000 mutual fund purchase that works out to ₹10. The cap is reached at ₹15,00,000.
- Which sectors get the flat ₹5 MDR?
Railways, telecom, insurance, fuel and agricultural inputs are named by the government, along with specified public utility payments: electricity distribution, municipal water charges and piped natural gas.
In these sectors a transaction above ₹2,000 carries a flat ₹5 rather than 0.4%, so the charge does not grow with the bill. Below ₹2,000 there is no MDR here either.
- Can merchants pass MDR to customers?
No. Merchants cannot pass MDR on to customers on UPI, and banks have been told to enforce that. You pay the posted price.
UPI apps are separately barred from charging a platform fee or any hidden charge.
- Is UPI MDR a government tax?
No. The Ministry of Finance has stated plainly that MDR is neither a tax nor a charge collected by the government or by NPCI.
It is shared among the participants that run UPI: banks, payment service providers and UPI app providers. Describing it as a government UPI fee gets both the payer and the recipient wrong.
- Does GST apply on top of the MDR shown here?
This calculator reports MDR only, exactly as the official framework defines it. It does not add a tax figure on top.
Tax treatment of payment-processing charges depends on the contract between a merchant and its acquiring bank or aggregator, and neither the FAQ nor the press release sets it. Your acquirer's invoice is the place to check that, and it is a question for your accountant rather than for this tool.
- Does MDR apply to a RuPay credit card linked to UPI?
Not under this framework. Credit-linked UPI, which covers RuPay credit cards on UPI and pre-sanctioned bank credit lines, runs on separate credit product rules because the payment is funded by a short-term loan from the issuing bank.
The rates on this page apply to direct payments from a user's bank account to a merchant's account. The calculator says so rather than giving you a number that would be wrong.
Sources and methodology
Every rate, threshold and category here comes from official government and NPCI material. Where those documents are silent, this calculator says so instead of filling the gap.
- Department of Financial Services FAQ on MDR on Select UPI (P2M) Transactions (PDF, opens in a new tab)
The 42-question policy document behind every rate, threshold and category in this calculator.
Department of Financial Services, Ministry of Finance, 15 September 2026 · PDF
- Ministry of Finance press release: UPI continues to remain free for peer to peer transactions and 96% of merchant transactions (opens in a new tab)
The government clarification that MDR is not a tax, names the essential sectors, and confirms customers pay nothing.
Press Information Bureau, Ministry of Finance, 15 September 2026
- NPCI copy of the MDR on Select UPI (P2M) Transactions FAQ (PDF, opens in a new tab)
The same FAQ published by NPCI, which operates UPI and sets the category caps.
National Payments Corporation of India, 15 September 2026 · PDF
How the numbers are worked out
Amounts are held as whole paise and rounded half-up to the nearest paisa, so results are exact rather than floating-point approximations. The rules live in one file, the calculator and the tables above both read from it, and the arithmetic is covered by unit tests at every threshold and cap.
What is left out
Education fee collections are placed in the industry programme category, but the FAQ describes the treatment only as flat-fee or capped rates without giving a figure, so the calculator reports that rather than assuming ₹5. Credit-linked UPI is priced as a credit product and is not covered by these rates. Tax treatment of MDR is not set by either source, so no tax is added to the result.
The capital market threshold, and why we read it this way
The sources give the capital market rate and its ₹300 cap without restating the ₹2,000 threshold for that category. They also say, without qualification, that MDR applies only to merchant transactions above ₹2,000. This calculator follows the second statement and treats small capital market payments as free.
Found something that does not match an official source? Tell us and we will check it. See the disclaimer for the limits of these estimates.
Last updated: . Effective from: 15 October 2026.