The Supreme Court has declined to grant an interim stay on the proposed merchant discount rate (MDR) for UPI transactions above Rs 2,000. Here is what it means for you.

What changes: a 0.4 per cent MDR is scheduled to apply from October 15 on specified merchant UPI payments above Rs 2,000. Person-to-person transfers remain free.

Who pays: the merchant, not the customer. MDR is a fee the bank or payment service provider charges the merchant for processing the transaction, similar to how card payments already work.

What the court said: in the September 29 hearing, the court refused to pause the move for now, seeking the Centre’s response instead. The legal challenge argues the charge undermines UPI’s free-transaction promise.

What to watch: whether the government tweaks the plan before October 15, and how merchants, especially small ones, absorb or pass on the cost. For now, your UPI payments under Rs 2,000 and transfers to friends are unaffected.