Disputed UPI Fee
Congress MPs Deny Endorsing Government Plan for New UPI Merchant Fees
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Key Points
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The five Congress MPs identified as attending the August 12 meeting were P. Chidambaram, Manish Tewari, Gaurav Gogoi, Kishori Lal and K. Gopinath; government sources said none recorded a dissent when the report was adopted.
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The Finance Committee’s report highlighted a major funding gap for the UPI ecosystem: the government had allocated Rs 2,000 crore, while the industry’s estimated operational cost was Rs 20,700 crore.
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Congress general secretary Jairam Ramesh accused the government of using the committee controversy to deflect attention from public opposition to the charges, describing them as an attempt to appease “US companies & Donaldbhai.”
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Under the announced framework, the 0.4% MDR will be paid by merchants rather than consumers, while person-to-person transfers and merchant payments of up to Rs 2,000 remain exempt.
Congress MPs Gaurav Gogoi and Manish Tewari rejected claims that the Parliamentary Standing Committee on Finance endorsed the government's new fee on high-value UPI payments. Business Standard reported that the committee discussed a broad need for merchant fees but did not approve specific rates or details announced by the government this week.
Starting October 15, India will charge merchants a 0.4% fee on UPI transactions above Rs 2,000, capped at Rs 300 for payments of Rs 75,000 or more. Person-to-person transfers and payments under Rs 2,000 stay free. The move has sparked anger from Congress leaders, who say it hurts small merchants and benefits big corporations.
What the Committee Actually Discussed
Five Congress MPs attended the Finance Committee's August 12 meeting: P. Chidambaram, Manish Tewari, Gaurav Gogoi, Kishori Lal, and K. Gopinath. Government sources claim none recorded formal dissent when the report was adopted. Millennium Post reported that Congress denied the government's claim that the committee backed the fee structure.
The committee raised concerns about UPI's funding gap. Business Standard noted the government allocated Rs 2,000 crore while industry estimated operational costs at Rs 20,700 crore. The committee discussed the broad need for an MDR but was not briefed on specific rates, ceilings, or exemptions before the government's announcement.
Congress Accuses Government of Misleading Public
Congress general secretary Jairam Ramesh charged the government with using the committee controversy to deflect from public anger. He accused officials of trying to appease "US companies & Donaldbhai." Organiser reported that Congress leader Rahul Gandhi and other party figures opposed the MDR policy.
Congress leaders warned the fee hurts small merchants while benefiting large corporations. They called the government's use of committee proceedings misleading and said the policy benefits foreign payment firms over Indian traders and customers.
Government Denies US Pressure on Fee Decision
ETV Bharat reported that India's Finance Ministry dismissed allegations that US pressure influenced the UPI fee decision. The Department of Financial Services said it does not expect the policy to shift more customers toward cash transactions. Deccan Herald reported similar denials from the Finance Ministry regarding external pressure.
The government stated that the fee structure protects small payments and remains fairer than cash handling costs. Merchants, not customers, pay the 0.4% fee. The NPCI circular offers no advantage to foreign credit card companies, the ministry said.
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