UPI MDR to uplift payments processing margin: Paytm
The National Payments Corporation of India (NPCI) notified a Merchant Discount Rate of 0.4% on person-to-merchant UPI transactions exceeding Rs 2,000, capped at Rs 300 for transactions above Rs 75,000, with P2P transfers remaining exempt. Paytm emphasized its business model focuses on customer acquisition via payments with monetization through financial services, so UPI MDR represents upside rather than foundation. The company expects stabilization of payments processing margin trends within 2-3 quarters post-implementation.
Key points
- NPCI mandated 0.4% MDR on UPI transactions above Rs 2,000
- P2P UPI transactions remain exempt from MDR
- Paytm projects 2.5 bps uplift in processing margins
- Framework implementation scheduled post-Diwali 2024
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