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GST Council takes no call on UPI MDR; deferment not its decision to make, says Sitharaman
Our read
The desk expects the 15 October start to be softened or pushed back by a body other than the GST Council, with the 18% GST rate left unresolved for a later meeting.
For operators
Treat the 15 October UPI MDR rollout as live, since the GST Council left deferment undecided, and work out which of your transactions fall in the affected group, where MDR is capped at ₹300 and NeoStrat estimates 95% of payments are unaffected.
Watch
An official notification or statement on the 15 October rollout, either confirming the date or announcing deferment
The report,
The 57th GST Council took no decision on the proposed UPI MDR, with Nirmala Sitharaman saying deferring the 15 October rollout is not for the Council to decide. States wanted the 18% GST on MDR exempted or cut to 5%.
Channel facts
From the report. Source details below
| Maximum MDR charge on affected transactions: | ₹300 |
|---|---|
| Payments unaffected by MDR (NeoStrat estimate): | 95% |
| Deferment requested to: | January 2027 |
What it means for online and offline
Run payments-linked deal and partnership models on two scenarios, a 15 October start versus a January 2027 deferment and 18% versus 5% GST on MDR, and avoid commitments that depend on MDR economics until the decision-maker acts.
Signals to track
- UPI MDR or GST rate relief appearing on the agenda of the next GST Council meeting
- Formal confirmation or rejection of the January 2027 deferment request
- Large merchants or payment apps announcing UPI surcharges or changes to their payment options
- UPI transaction volumes in the weeks after 15 October, if the rollout goes ahead
Likely next moves
Our read of what comes next — analysis, not reported by the source.
- The authority that owns the rollout date is likely to decide on the 15 October start, or on deferment, close to the deadline, since the Council has declined to rule on it.
- States are likely to keep pushing for the 18% GST on MDR to be exempted or cut to 5%, probably by seeking a place on a future Council agenda.
- Industry bodies and payment players are likely to keep lobbying for deferment to January 2027, citing readiness and cost.
- Large merchants facing MDR on affected transactions may adjust their payment mix or consider pass-through charges, while the ₹300 cap limits the worst-case cost per transaction.
- Expect the government to keep stressing that about 95% of payments are unaffected, citing NeoStrat's estimate, to contain political and consumer pushback.