Congress MPs on Finance Panel Did Not Dissent on UPI Charges: Sources

Five Congress members of the Parliamentary Standing Committee on Finance did not record any dissent when the panel adopted a report recommending charges on certain UPI transactions in August, sources said on Wednesday. The disclosure comes as the Opposition party campaigns against the government's decision to levy a Merchant Discount Rate (MDR) on merchant payments.

Among the five MPs were former ministers P Chidambaram and Manish Tewari. Gaurav Gogoi, Kishori Lal and K Gopinath also attended the meeting at which the committee adopted the report, the sources said, adding that the proceedings do not record dissent from any of them.

The panel, chaired by Bhartruhari Mahtab of the BJP, recommended in its 44th report that a tiered MDR framework be notified and implemented without delay. It cautioned that a delay in rolling out the structure for UPI and RuPay transactions could leave payment service providers dependent on inadequate government support, hurting spending on cybersecurity, fraud prevention and network infrastructure. The committee flagged a gap between the Rs 2,000 crore allocated in the budget and the Rs 20,700 crore the industry estimates it needs to cover operational costs.

In an earlier report, the committee had asked the Department of Financial Services to consider a tiered model under which street vendors and small businesses would remain exempt while larger entities would pay a fee. The report was tabled on August 12, two days after the Rajya Sabha cleared legislation amending the Payment and Settlement Systems Act, 2007, to remove the legal bar on levying MDR on UPI and RuPay debit card payments.

Leader of the Opposition Rahul Gandhi has demanded a rollback of the charge, which is set to take effect from October 15 on merchants for transactions above Rs 2,000, at a rate of up to 0.04%. On Wednesday, he posted a video on X alleging that Prime Minister Narendra Modi acted under pressure from the United States to impose the fee, an allegation the finance ministry rejected. The government has ruled out a rollback, stating that MDR is neither a tax nor a charge collected by the government or the National Payments Corporation of India (NPCI), but is shared among payment ecosystem participants, including banks and payment app providers.

The government announced the fee on Tuesday, keeping person-to-person transfers and small payments outside its ambit. It is payable by merchants and capped at Rs 300 for transactions of Rs 75,000 or more. According to NPCI, payments above Rs 2,000 for railways, telecom, insurance, fuel, electricity distribution, municipal water and piped natural gas will carry a flat MDR of Rs 5, while capital-market payments, including to mutual funds and stockbrokers, will carry 0.02%, capped at Rs 300. UPI AutoPay and recurring mandates are excluded.