The Centre is moving to reimpose Merchant Discount Rate on UPI payments, Finance Minister Nirmala Sitharaman has explained, in a shift from the zero-MDR framework that has applied since launch.From October 15, a 0.4 percent MDR will apply to person-to-merchant UPI payments above Rs 2,000. The charge will be borne by merchants, capped at Rs 300 for transactions of Rs 75,000 or more. Consumers will not pay the charge.Sitharaman has stressed this is not a tax, cess or surcharge. "The collection is not coming to the Consolidated Fund of India," she said. The fee goes to service providers like NPCI, aggregators and merchant banks.About 75 percent of UPI transactions remain unaffected, since most are below Rs 2,000. The decision was jointly taken by NPCI, payment banks and merchant banks, and Sitharaman rejected claims it was taken under external pressure. NPCI's Dilip Asbe noted that about 75 percent of UPI transactions remain unaffected, with fees falling mainly on larger businesses.