News
UPI Charges on Payments Above ₹2,000 Delayed Until After Diwali
The new merchant fee has been postponed from October 15 to after Diwali, giving businesses more time to prepare. But will your everyday UPI payments cost more?
For millions of Indians, paying through UPI has become second nature. From buying groceries and ordering food to shopping for clothes, a quick scan of a QR code is often all it takes.
But a proposed change to UPI payments is set to introduce a cost for certain transactions above ₹2,000. The rollout, originally scheduled for October 15, has now been postponed until after Diwali, following requests from traders concerned about the impact during the festive shopping season.
The National Payments Corporation of India (NPCI) has said that the revised implementation date will be announced separately. The delay gives merchants and payment companies additional time to prepare for the change.
What Is the New UPI Charge?
The proposed change introduces a Merchant Discount Rate (MDR) of 0.4% on eligible person-to-merchant (P2M) UPI transactions above ₹2,000.
MDR is a fee associated with processing digital payments. Under the proposed framework, the fee will be paid by eligible merchants rather than customers.
Here is what the 0.4% charge could look like:
- A ₹2,000 payment would attract a fee of ₹8, where applicable under the proposed framework.
- A ₹5,000 payment would attract a fee of ₹20.
- A ₹10,000 payment would attract a fee of ₹40.
The fee will be capped at ₹300 for transactions of ₹75,000 and above. Certain categories, including railways, telecom, insurance and fuel, will follow a separate flat-fee structure for eligible transactions above ₹2,000.
However, the standard MDR will not apply to every merchant or every UPI transaction. Small merchants meeting the specified eligibility criteria, including those receiving up to ₹1 lakh a month through UPI QR payments, are exempt under the announced framework.
Will You Have to Pay More When Using UPI?
The short answer is no. The proposed MDR is a merchant-side charge, not a new transaction fee for customers.
Payments between individuals, such as sending money to a friend or splitting a dinner bill, will continue to remain free. Customers making eligible payments to merchants are also not supposed to be charged the MDR separately.
For example, if you buy something worth ₹5,000, the proposed 0.4% MDR would amount to ₹20 for the eligible merchant. It is not intended to mean that you must pay ₹5,020 simply because you used UPI.
Banks have been advised to ensure that merchants do not pass the charge directly on to customers.
However, the wider impact on prices and payment preferences remains worth watching. Businesses facing higher payment-processing costs could reconsider their pricing or how they accept digital payments, even though the framework is designed to protect consumers from a direct MDR charge.
Why Has the Rollout Been Delayed?
The original October 15 deadline fell during the festive shopping period, when spending on clothing, electronics, travel and other purchases typically increases.
Trader groups had asked for the implementation to be postponed, arguing that introducing a new payment cost during this busy period could create additional pressure on businesses.
The NPCI’s decision to move the rollout to after Diwali gives merchants and payment companies more time to update their systems and prepare for the change.
It also gives businesses an opportunity to understand how the new rules will affect their payment-processing costs before implementation begins.
Why Is UPI Introducing Merchant Charges?
UPI has become a major part of India’s digital payment infrastructure. Keeping the system running requires investment in technology, cybersecurity, fraud prevention, system reliability and customer support.
According to the Centre, the proposed MDR is intended to help fund these operational costs. The government has cited industry estimates that running UPI infrastructure costs around ₹20,000 crore annually.
The debate, however, is about finding a sustainable way to fund this infrastructure without discouraging people and businesses from using digital payments.
For merchants, particularly smaller businesses, the additional cost could influence how they manage transactions. For payment companies and banks, the proposed fee could help support the cost of maintaining the system.
The Real Impact
For now, customers do not need to change how they use UPI. The proposed merchant charges have been postponed until after Diwali, and the exact implementation date is yet to be announced.
The bigger question is how the change will affect businesses once it takes effect. UPI’s popularity has been built on convenience and ease of use. The challenge will be to fund the infrastructure behind digital payments without making the experience more expensive or complicated for the people and businesses who rely on it.
Explainer
The ₹80,000 Phone: A Status Symbol or a Financial Mistake?
For young earners, buying an expensive smartphone can feel like a reward for hard work. But when does the desire to look successful start getting in the way of building wealth?
The first salary brings a new kind of freedom. A young professional can finally buy things without asking for money. And often, the first big purchase is a smartphone.
Friends are flaunting their latest devices, Instagram is flooded with unboxing videos and a perfectly functional phone suddenly feels outdated. An ₹80,000 smartphone starts looking less like an expense and more like a reward for all the hard work.
But there is a difference between buying something because it adds value and buying it because it makes life look better to others.
India’s premium smartphone obsession
India’s smartphone market is moving towards premium devices. According to Counterpoint Research, smartphones priced above ₹30,000 accounted for 22% of smartphone shipments in India in 2025, their highest ever share.
A July 2026 Counterpoint Research survey also found that 46% of prospective smartphone buyers in India were willing to stretch their budgets to purchase their preferred phone despite price increases. Among consumers aged 25 to 30, the figure was 52%.
These numbers do not mean everyone buys expensive phones for status. Better cameras, performance and software support can justify the premium. However, they highlight how willing consumers can be to spend beyond their original budgets for a device they desire.
For young professionals still building their savings, this creates a dilemma: should the money go towards a premium phone or towards financial security?
What does an ₹80,000 phone actually cost?
Consider someone earning ₹40,000 a month and choosing between a ₹15,000 smartphone and an ₹80,000 device.
The premium phone costs twice their monthly salary before deductions. The budget alternative costs less than half of one month’s salary.
The difference is ₹65,000. That money could help build an emergency fund, pay for professional training or contribute towards future investments.
Of course, a premium phone may offer better features and a longer useful life. The point is not that expensive phones are always a bad purchase. It is whether the additional benefits justify the additional cost.
The EMI trap
Monthly instalments can make an expensive purchase feel manageable. Instead of thinking about ₹80,000, buyers focus on a smaller monthly payment.
But an affordable EMI does not automatically make a purchase financially sensible.
If repayments leave little money for savings, rent or other priorities, the phone may be stretching the budget more than it appears. Interest and fees can also increase the total cost.
The real cost of keeping up
The phone that attracts compliments today may become ordinary tomorrow. A newer model arrives, attention shifts and the excitement fades. The money spent, however, does not return.
For someone whose main motivation is social recognition, this creates an uncomfortable trade off. The owner bears the full cost while the approval may last only a short time.
Choosing a budget phone and keeping the ₹65,000 difference could create room for savings, experiences or investments. For illustration, ₹65,000 invested at an assumed annual return of 10% could grow to approximately ₹1.05 lakh over five years, before taxes and charges. Actual returns are not guaranteed.
So, should young earners buy budget phones?
Not necessarily. A premium phone can be worth the money when its features genuinely matter and the purchase fits comfortably within the buyer’s finances.
But before upgrading, it helps to ask: is the phone being purchased for its usefulness or because everyone else seems to have one?
Affordable smartphones have expanded the choices available to consumers. For everyday needs such as messaging, digital payments, browsing and streaming, a budget device may be sufficient.
A smartphone can signal purchasing power, but it cannot tell anyone how financially secure its owner really is.
The real flex is not owning the most expensive phone. It is being able to afford the things that matter without sacrificing the financial freedom that makes them possible.
News
India-US Trade Pact Enters Final Drafting Stage
The first phase of the India-US trade agreement is in the final stages of legal drafting, with India seeking better market access and a competitive advantage for its exporters.
India and the United States are moving closer to finalising the first phase of their bilateral trade agreement, Commerce and Industry Minister Piyush Goyal said on Thursday. The agreement is currently undergoing legal drafting, with the government hoping to complete the process soon.
However, India wants to ensure that the deal gives its exporters a competitive advantage over businesses from other countries before it is implemented.
What Is the Latest Update?
According to Goyal, the first tranche of the India-US trade agreement has been finalised and is now going through the final stages of legal drafting.
Commerce Secretary Rajesh Agrawal also said negotiations were progressing in the right direction, with both countries working towards concluding and signing the agreement at the earliest.
However, the final timeline depends partly on the United States formalising its broader tariff framework. India is also seeking greater stability in tariffs and preferential access to the American market so that Indian exporters can compete effectively with businesses from other countries.
Why Does India Want a Competitive Advantage?
The US is India’s largest destination for merchandise exports, making trade terms between the two countries important for Indian businesses.
Preferential market access could help Indian exporters compete more effectively in the US by improving the tariff conditions under which their goods enter the market.
For example, if Indian products face lower tariffs than similar products from competing countries, they could become more attractive to American buyers. This could potentially help Indian businesses expand exports and secure new orders.
India is therefore looking beyond simply signing an agreement. It wants terms that allow its exporters to compete on favourable footing in the American market.
What Happens Next?
While the first phase has reached the legal drafting stage, some steps remain before the agreement can be signed and implemented. These include aligning the deal with the broader US tariff framework and resolving the remaining issues.
Separately, Goyal said the India-European Union free trade agreement is expected to be signed in December 2026 and could come into force in February or March 2027.
For India, these trade negotiations form part of a wider effort to strengthen international trade ties and improve opportunities for domestic businesses.
Source: The Economic Times
IPO Watch
Jio IPO 2026: How the ₹30,213 Crore Issue Will Use Its Funds
Unlike several major IPOs where existing investors sell their stakes, Jio Platforms’ upcoming public issue will raise fresh capital for the company, with most of the proceeds earmarked for debt repayment.
India’s IPO market is gearing up for a major milestone. Jio Platforms, the digital services arm of Reliance Industries, is preparing to launch a ₹30,213 crore initial public offering (IPO), which could become the country’s largest-ever public issue.
But the size of the offering is not the only thing setting it apart. The structure of Jio’s IPO makes it different from several large listings seen in India over the past few years.
A Fresh Issue, Not an Investor Exit
Jio Platforms’ IPO will consist entirely of newly issued shares, with no offer-for-sale (OFS) component. This means existing shareholders will not be selling their shares as part of the public issue.
In an OFS, existing investors or promoters sell some of their holdings to public investors. The money from that sale goes to the shareholders selling their stakes rather than to the company itself.
A fresh issue works differently. The company creates and issues new shares to raise capital, which it can then use for specified business purposes.
For Jio Platforms, this means the funds raised through the IPO will go to the company, rather than serving as an exit route for its existing investors, including Reliance Industries, Meta and Google.
Where Will the IPO Money Go?
A significant portion of the proceeds will be used to repay or prepay borrowings of Reliance Jio Infocomm, Jio Platforms’ telecom subsidiary.
The company has earmarked up to ₹27,500 crore of the net proceeds for this purpose, with the remaining funds intended for general corporate purposes. At the upper end of the IPO’s price band, the debt repayment allocation accounts for approximately 91% of the total issue size.
Reducing debt can help lower interest expenses and strengthen a company’s balance sheet. For Jio, the proposed repayment could support its financial position as it continues to expand its digital and telecom businesses.
When Is the IPO Opening?
Jio Platforms has fixed a price band of ₹1,065 to ₹1,119 per share. The public issue is scheduled to open on October 21 and close on October 23, 2026, with anchor investor bidding planned for October 19.
At the upper end of the price band, the company could raise ₹30,213 crore, surpassing Hyundai Motor India’s ₹27,859 crore IPO in 2024.
The offering values Jio Platforms at approximately ₹10.3 lakh crore, making it one of the most significant listings in India’s capital markets.
A Growing Business Heads to the Stock Market
The IPO comes as Jio Platforms continues to expand its presence across telecommunications and digital services. In FY26, the company reported revenue from operations of approximately ₹1.47 lakh crore, while its net profit rose to ₹30,049 crore.
Its subscriber base has also grown substantially since Reliance Jio entered the telecom market in 2016, disrupting the industry with affordable data and voice services.
The listing will give public-market investors an opportunity to invest directly in Jio Platforms and provide a market valuation for Reliance Industries’ digital business.
For investors, however, the size of an IPO alone does not determine whether it is a suitable investment. The company’s valuation, financial performance, future growth prospects and risks all matter when evaluating a public issue.
Source: Moneycontrol
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