Mayawati criticises 0.4pc UPI merchant fee, calls it ‘profiteering’

BSP chief Mayawati criticised the Centre's new 0.4 per cent MDR on specified UPI merchant transactions above Rs 2,000, calling it a "capitalist profiteering attitude". The government has said customers and person-to-person UPI transactions will remain free

Lucknow: Bahujan Samaj Party chief Mayawati termed the Centre’s move to introduce a 0.4 per cent fee on Unified Payments Interface (UPI) merchant transactions worth more than Rs 2,000 from October 15 as, prima facie, a “capitalist profiteering attitude” that recovers tax from the people with both hands.

In a post on X in Hindi on Friday, Mayawati said, “After vigorously promoting UPI digital transactions initially, the government’s new arrangement to now levy fees on those transactions, prima facie, appears as a capitalist profiteering attitude involving tax recovery from the people with both hands, which has naturally resulted in unease and outrage among the public.”

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She said the public is unwilling to accept this system, which imposes an additional financial burden on them as a ‘tax’. Regardless of the name given to this system, which is set to take effect on October 15, it will ultimately burn a hole in the pockets of common people and increase their expenses, she said.

“It is well known that the vast majority of the country’s population is tormented by extreme poverty, rampant inflation, and the like, and their children are affected by illiteracy, unemployment, disorder, and so on,” Mayawati said.

“In such circumstances, it would be appropriate for the government’s policies and action plans to prioritise welfare over commercial profit-making. If the government does not concern itself with the public hardships and sufferings, then who will?” the BSP chief said in the X post.

Ending nearly six years of free UPI payments, the government on Tuesday introduced a 0.4 per cent fee on merchant transactions exceeding Rs 2,000 through the platform, starting October 15. The government explicitly ring-fenced everyday person-to-person transactions and small payments from any charge.

“Customers will not be required to pay any charge when making such payments through UPI,” the Finance Ministry said in a statement, adding, “MDR is a charge within the merchant payment ecosystem. It is not a charge on customers making UPI payments.” Individuals will also continue to have “unlimited free usage, with no monthly quotas, volume restrictions or tiered caps on free UPI transactions”, it said.

The move drew sharp criticism from opposition parties.