Does Splitting UPI Payments Under Rs 2,000 Avoid MDR Fees?
By ThePip Desk
Wondering if splitting UPI payments into Rs 2,000 tranches avoids MDR fees? Discover the truth about zero-MDR policy and UPI charges in India.
A common query circulates among Unified Payments Interface users asking whether dividing large transactions into smaller amounts of Rs 2,000 or less helps bypass Merchant Discount Rate charges. This practice remains entirely unnecessary for standard transfers.
Understanding MDR and UPI Fees
Merchant Discount Rate is a fee paid exclusively by merchants to payment service providers for processing digital transactions, rather than by individual consumers.
The government mandates a zero-MDR policy on Unified Payments Interface transactions. No such charges apply to either the merchant or the customer for standard payments.
The Reality of Splitting Payments
Attempting to split large transactions into multiple tranches offers zero financial benefit. The practice only serves to complicate transaction records without saving any money.