The rollout of merchant charges on large UPI payments may be deferred from October 15 to January 1, 2027, amid pushback from trader groups. A final decision is expected in the coming days.

Under the announced framework, person-to-merchant UPI payments above Rs 2,000 would attract a 0.4 percent merchant discount rate. The charge is capped at Rs 300 per transaction. Payments up to Rs 2,000 and all person-to-person transfers stay free.

Punjab and Sind Bank MD Swarup Kumar Saha told PTI that merchants cannot pass the charge to customers. Shoppers will pay only the listed price. He said over 95 percent of merchant UPI payments by volume are below Rs 2,000 and will stay unaffected.

A proposal to exempt businesses with annual turnover up to Rs 40 lakh is also under consideration. Essential items like milk and bread may carry a flat Rs 5 charge instead of the percentage fee. Digital payment stocks fell on the delay uncertainty.