New Delhi, 15 September— Leader of the Opposition in the Lok Sabha Rahul Gandhi today pointed an accusing finger at the Modi government saying that it has “quietly opened the door to imposing fees on UPI,” with his party asking whether this was being done to open digital payments for American firms to “appease” US President Donald Trump.
The Congress reaction came a day after a Finance Ministry notification directed banks and payment system providers not to levy charges on Unified Payments Interface (UPI) transactions of up to Rs 2,000 or on payments made through RuPay debit cards.
At the same tme, the Finance Ministry has not specified whether charges would be applicable to transactions above Rs 2,000, to be paid by merchants. So far, there has been no charge on UPI transactions, irrespective of the amount.
“The Modi government has quietly opened the door to imposing fees on UPI,” Rahul wrote in Hindi on X (formerly Twitter).
“Now, MDR can be levied on merchant UPI transactions above ₹2,000. Even if these transactions account for just 5% of the volume, they make up nearly 65% of UPI’s total transaction value.
“The government says no fees will be charged to customers. But where will the fees imposed on shopkeepers ultimately come from? Added to prices, straight out of the customer’s pocket.
“American payment companies have long opposed India’s zero-MDR policy. Now, the Modi government has opened the path to changing the policy in exactly that direction,” Rahul Gandhi underlined in his post.
“Just like with the US Trade Deal, Compromised PM Modi is once again surrendering to American pressure,” he alleged.
The Congress alleged that the government has yet again shown complete lack of honesty and transparency and broken the trust of users.
“Just as we warned on August 6, 2026 to which the Hon’ble FM herself had deemed it fit to respond, the Modi Government is now using new laws bulldozed through Parliament to start the process of charging for UPI,” wrote Congress general secretary in-charge communications Jairam Ramesh.
“A notification has just been issued under the amended Payment and Settlement Systems Act, 2007 that prohibits banks and providers from charging only for UPI transactions under Rs 2000. But there is NO explicit protection for any transaction above this cap,” Ramesh said on X.
The stage is clearly being set for all of us to pay a fee for UPI transactions, he claimed.
“Tomorrow the cap itself might be changed with another such notification – there is no longer a guarantee in the law. For all we know, the government can introduce a charge for daily person-to-person transactions as well,” Ramesh said.
“The Modi government has yet again shown complete lack of honesty and transparency and has broken the trust of users. Is all of this being done to open digital payments for American companies to appease President Trump?” Ramesh said.
Notification of the Finance Ministry follows an amendment to section 10 A of the Payment and Settlement Systems Act, 2007, which provides an enabling framework for imposing a Merchant Discount Rate (MDR) on payments through UPI and other notified electronic payment modes.
The amendment bill was passed by Parliament during the Monsoon Session, which concluded on August 13. Following the passage of the bill, the government had said the UPI and Services Steering Committee, headed by the National Payments Corporation of India (NPCI), would decide on the MDR rates.
In a statement, the government sought to justify the measure saying that with exponential transaction volumes, the system requires significant and continuous upgrades in cybersecurity, fraud prevention, and infrastructure.
Charges were required for market expansion and self- sustainability, it had said. It is necessary to increase competition by encouraging more companies to expand their operations, which requires a self-sustaining revenue model, it had said.
Reliance on subsidies alone is not viable for the next wave of growth, it had said, adding that a balanced framework is required to ensure that UPI remains robust, inclusive, and future-ready.
UPI is operated by the National Payments Corporation of India (NPCI), an initiative of the Reserve Bank of India and the Indian Banks’ Association.
Last month, the Congress had attacked the government over the Taxation and Other Laws (Amendment) Bill before it was passed, asking whether Prime Minister Modi was seeking to dilute UPI and open the digital payments sector to American businesses “under pressure” from his “good friend Donald Trump”.
Union finance minister Nirmala Sitharaman had said the MDR on digital transactions applies to merchants and not to customers and that the MDR charge would support banks and fintech companies to invest more on infrastructure and security.
Sitharaman had said the UPI and Services Steering Committee headed by NPCI is yet to decide on the MDR, which would happen only after Parliament passes the Taxation and Other Laws (Amendment) Bill, 2026.
Replying to Ramesh, Sitharaman had said, “Before spreading a canard, @Jairam_Ramesh ji, please consider this: Merchant Discount Rate (MDR) applies only on the merchants and not on the end users/customers. It will support the Banks & Fintech to invest more on infrastructure, innovation & security. All users of UPI will reap the benefits of this investment.”
A fundamental question that is relevant to the issue whether merchants selling goods or services will pay from their own pockets or take it from consumers by raising prices
Veteran Journalist and Political Commentator
