Why are petrol pump dealers in Madhya Pradesh stopping UPI payments above ₹ 2,000?

Petrol pump dealers in Madhya Pradesh are stopping UPI payments above ₹ 2,000 due to a new merchant discount rate (MDR) of 0.4%, which they claim affects their already thin profit margins.

How will the new MDR rule impact consumers, especially in rural areas?

The new MDR rule will force consumers, particularly in rural areas who rely on UPI for payments, to switch to cash transactions, which may inconvenience them and reduce the ease of digital payments.

What are the consequences for merchants who choose not to accept UPI payments under the new MDR?

Merchants who opt not to accept UPI payments due to the new MDR may face increased cash transactions, lose potential sales, and need to adjust pricing strategies to maintain profitability.

MP petrol pump dealers to stop accepting UPI payments above ₹2,000 from October 15

The decision was taken unanimously at a meeting of the MP Petrol Pump Association, which represents 4,700 dealers statewide.

Updated on: Sep 19, 2026, 19:12:19 IST

By HT Correspondent

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Starting October 15, petrol pumps across Madhya Pradesh will stop accepting Unified Payments Interface (UPI) transactions above ₹2,000, citing losses due to the newly imposed merchant discount rate (MDR).

The decision was taken unanimously at a meeting of the MP Petrol Pump Association, which represents 4,700 dealers statewide. (AFP)

The decision was taken unanimously at a meeting of the MP Petrol Pump Association, which represents 4,700 dealers statewide. Dealers said they will accept only cash for payments above ₹2,000, refusing to bear the 0.4% MDR introduced by the Centre.

Also read | Govt preparing system to ensure UPI fee doesn't hit customers: Report

Association president Ajay Singh said, “Petroleum dealers across the state are opposing the central government’s new policy. A significant portion of fuel sales happens via UPI, and our fixed profit margins will be hit by this duty.”

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In a written statement, the association said that dealers were already paying MDR on credit card transactions. “Now, imposing this duty on UPI will only create further financial loss for us,” the note read.

While the association clarified it will not stage protests, it intends to discourage UPI payments by limiting them.

Also read | Small merchants may rethink accepting UPI over cash, says Retailers' body on merchant fee row

“The move will hit hard the consumers from rural areas as they are were using only UPI for payment,” said an association member.

Madhya Pradesh

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