Most surveyed Mumbai consumers reject passing UPI fee to customers, study finds
A LocalCircles study says 79% of surveyed Mumbai residents would switch payment methods or use cash if merchants passed on a 0.4% merchant discount rate for UPI payments above ₹2,000. The fee is scheduled to take effect on October 15, ending more than six years of zero MDR.
Four in five surveyed Mumbai residents would not continue using UPI if a merchant passed on a fee for payments above ₹2,000, according to a LocalCircles study released on Thursday. The survey found that 29% would switch to a credit card, 20% would pay in cash and 17% would use a debit card if charged. Only 21% said they would continue using UPI in that situation.
LocalCircles collected more than 6,500 responses from consumers in Mumbai. In a separate national survey covering more than 67,000 UPI users across 291 districts, only 14% said they would continue using UPI if merchants passed on the fee. Twenty-seven per cent would pay cash and 26% would use a credit card.
The survey found that 75% of Mumbai respondents expected to use cards, cash or bank transfers most often for purchases above ₹2,000 if UPI became more expensive. Maharashtra accounted for 9.84% of UPI transactions by volume and 9.11% by value in April 2026, according to NPCI state data. The government’s 0.4% MDR for person-to-merchant UPI payments above ₹2,000 is due to take effect on October 15.
The framework was notified by the Finance Ministry on September 14 through Gazette notification S.O. 5067(E). The MDR is capped at ₹300 for payments of ₹75,000 and above.
The Federation of Retail Traders Welfare Association has called for a “No UPI Day” on October 2. Its president, Viren Shah, said there was concern that the rate could rise in future. The Maharashtra Chamber of Commerce, Industry and Agriculture has backed the protest.
A trade delegation met the Finance Minister on September 30 and was told its concerns would be considered. FRTWA has nevertheless refused to cancel the action and says more than 150 traders’ associations support it.
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