UPI 'lagaan': Will MSMEs and the common man bear the brunt?

“What is this? UPI lagaan (tax)? Is it a fee? Is it a rate?” The Supreme Court’s question over the proposed merchant discount rate (MDR) on UPI payments has brought renewed focus on who ultimately bears the cost of the levy. The issue has also raised questions over the future of digital payments and the possibility of consumers and merchants shifting back to cash.

The Federal spoke to Prof Deepanshu Mohan, Professor of Economics and Dean, IDEAS, Office of Interdisciplinary Studies at OP Jindal Global University, and Mitali Nikore, Economist and Gender Policy Specialist, about the implications of the proposed UPI charge and the Supreme Court proceedings.