Update, 13 October 2026: The National Payments Corporation of India (NPCI) has postponed the planned introduction of a 0.4% charge on merchants for UPI payments above ₹2,000 until after Diwali, Reuters reported on Tuesday. The fee was due to take effect on 15 October; NPCI said a new implementation date would be announced separately. This is a postponement, not a cancellation of the proposal.
What changed in India’s UPI fee plan?
Under the reported proposal, merchants accepting qualifying Unified Payments Interface payments above ₹2,000 would face a 0.4% charge. The proposed rollout has been deferred in view of Diwali shopping, one of the busiest periods for Indian retailers. Reuters reported that the holiday falls on 8 November in 2026.
The most important distinction for consumers and businesses is between an announced merchant-side fee and a fee paid by customers. The news does not establish that a customer will automatically pay 0.4% more at checkout. The final fee mechanics and any business decisions about prices should be checked against the subsequent NPCI notification and payment-provider instructions.
Why the timing matters to small retailers
Festival demand often means higher numbers of QR-code payments at clothing shops, electronics dealers, jewellery stores and other retail businesses. Any change to payment acceptance costs can affect margins, reconciliations and customer communications. Deferring the switch gives merchants more time to check which payments qualify and whether their payment service providers require changes.
For illustration, 0.4% of ₹3,000 is ₹12. That calculation explains the percentage only; it is not a statement that every ₹3,000 UPI transaction will incur exactly ₹12 under final rules. Threshold treatment, applicability and settlement conditions require official guidance.
What have merchants and payment providers said?
According to Reuters’ 13 October report, the Confederation of All India Traders (CAIT) welcomed the delay and cited a meeting between industry representatives and India’s finance minister on 30 September. The Payment Council of India said the industry would be ready after the festive season. These statements describe reactions to the announcement, not a guarantee of a particular final start date.
What should a shop owner do now?
- Do not change checkout charges based on a headline. Wait for NPCI and your bank or payment aggregator to explain applicable rules.
- Record the mix of small and large UPI transactions. It will help estimate exposure if a merchant charge becomes effective.
- Review your settlement reports. Check whether any fee appears, when it appears and how it is itemised.
- Protect customer trust. Avoid describing the proposed merchant charge as an existing mandatory customer surcharge.
- Keep watch for the new date. The 15 October launch is deferred; an official post-Diwali date is still needed.
For context on how India’s UPI platform is expanding abroad, read BCC’s UPI international payments explainer. Cross-border acceptance and domestic merchant fees are separate questions.
Frequently asked questions
Will UPI merchant payments cost more on 15 October 2026?
The proposed 15 October implementation was postponed, according to NPCI’s announcement reported on 13 October. Merchants should check their provider for the applicable terms.
When will the 0.4% UPI charge start?
NPCI said the new date would be announced separately after Diwali. Do not treat any unconfirmed date as final.
Does the reported proposal cover every UPI payment?
No. The report describes a proposed merchant fee relating to transactions above ₹2,000. Exact coverage depends on the final published rules.
Source and editorial note
Primary report: Reuters, 13 October 2026. This article distinguishes the policy announcement from possible effects on individual merchants and customers; operational details should be confirmed from NPCI and the merchant’s own payment provider.