Trade and business associations across India have announced plans to observe “No UPI Day” on October 2, protesting the proposed Merchant Discount Rate (MDR) on certain high-value Unified Payments Interface (UPI) transactions. The campaign is scheduled ahead of the proposed implementation of the new MDR framework from October 15, 2026.
Under the proposed framework, merchants would be charged an MDR of 0.4% on eligible person-to-merchant UPI transactions above ₹2,000, with the charge capped at ₹300. Person-to-person UPI transactions would remain outside this proposed merchant charge.
Why Are Traders Protesting?
Trade bodies argue that introducing MDR on UPI payments would increase operating costs for retailers, distributors and other businesses, particularly those working with relatively thin margins. Industry representatives have called for the continuation of a zero-MDR structure for UPI merchant payments.
The Maharashtra Chamber of Commerce, Industry and Agriculture (MACCIA) has called for October 2 to be observed as “No UPI Day” and said trader associations from different parts of the country are expected to participate. Several organisations, including the Federation of Retail Traders Welfare Association, All India Consumer Products Distributors Federation, All India Mobile Retailers Association and All India Jewellers and Goldsmith Federation, have indicated support for the protest.
QR Codes and UPI Devices to Be Covered
As part of the symbolic protest, participating traders plan to cover UPI QR codes, payment scanners and sound boxes with black cloth on October 2. The date coincides with Gandhi Jayanti.
Trade representatives have said the protest is intended to draw attention to their concerns before the proposed MDR regime takes effect. Some associations have also indicated that further action could be considered if their concerns are not addressed.
Impact on Businesses
The proposed MDR has become a particular concern for sectors where individual customer payments frequently exceed ₹2,000. Petrol pump dealers, for example, have sought exemptions, arguing that additional payment charges could affect their regulated margins. Industry associations representing manufacturing and MSME businesses have also raised concerns about additional costs associated with digital transactions.
At the same time, the proposed framework is not limited to ordinary retail transactions. Reports indicate that a separate 0.02% MDR, capped at ₹300, has been proposed for certain capital-market transactions involving mutual funds, brokers, dealers and investment advisers.
UPI has become a major part of India’s digital payments ecosystem. In August 2026 alone, UPI processed 15.51 billion person-to-merchant transactions worth ₹8.95 trillion, according to data cited by Business Standard.
The October 2 “No UPI Day” will therefore serve as a significant industry-led demonstration of opposition to the proposed MDR structure, with businesses seeking clarity and relief before the October 15 implementation date.
