The News Today: Rajnish Kumar, Bishwajit Bhattacharyya on UPI Merchant Charge Debate
A debate on The News Today examines the Modi government's gazette notification regarding merchant fees on high-value digital transactions. Under the new rules, transactions up to Rupees 2,000 on UPI and RuPay debit cards remain entirely tax-free, while payments above that threshold face a merchant discount rate of up to 0.4%. Former State Bank of India Chairman and current Mastercard India Chairman Rajnish Kumar defends the measure, clarifying, 'No, it is not a tax. That's not the right word to use. This is a fee which is payable by the merchant for the convenience.' Kumar argues the system requires massive capital for technology, cybersecurity, and fraud prevention, which cannot remain cross-subsidised indefinitely. In contrast, former Additional Solicitor General Bishwajit Bhattacharyya warns that merchants will pass the burden to consumers, effectively turning it into a destination-based consumption tax, and urges the government to continue subsidising India's digital payment ecosystem.
