New Delhi [India], September 17 : Congress General Secretary KC Venugopal on Thursday termed the government's clarification on the revised Unified Payments Interface (UPI) Merchant Discount Rate (MDR) framework "completely bogus" and alleged that the move would burden the common man.
Speaking to ANI, Venugopal said the government was contradicting its earlier claims about the benefits of digital transactions and alleged that people were now being asked to pay in cash.
"This is completely bogus; they are spreading. They are saying that the entire transaction of money is going to become a digital transaction. Earlier, you made it as their advantage, and you claimed it as the biggest advantage of the Modi government, and their transaction is now digital. Now you are asking the people to pay money in cash," Venugopal said.
He also alleged that the government had "completely surrendered to the US" and said the Congress would raise the issue more widely.
"Everybody knows that this government is completely surrendered to the US. This is a common man's issue. We will take it up in a bigger way because we cannot allow the government to do all these anti-people activities," he said.
Venugopal's remarks come amid a political row over the revised UPI MDR framework announced by the National Payments Corporation of India (NPCI).
Under the new framework, a 0.4 per cent MDR will apply to select Person-to-Merchant (P2M) UPI transactions above Rs 2,000, capped at Rs 300 per transaction. The framework will come into effect from October 15, 2026.
The Centre has clarified that MDR is neither a tax nor a charge collected by the government, but is distributed among participants in the digital payments ecosystem, including banks and payment application providers.
Union Minister for Communications Jyotiraditya M Scindia has said that consumers will continue to use UPI free of cost and that merchants cannot pass the MDR cost on to customers.
"There is no recommendation to levy this on the customer. Doing so would violate the law and amount to a criminal offence," Scindia told ANI.
"This will never be imposed on the customer or the common man. You cannot impose this on our consumer," he added.
The government has also said that the revised framework will have no impact on Person-to-Person (P2P) transactions, which will remain free irrespective of the amount transferred. It has further stated that around 96 per cent of P2M transactions will remain unaffected as the MDR will apply only to specified merchant transactions above Rs 2,000.
The Congress has opposed the revised framework, with several party leaders alleging that the move amounts to imposing a "UPI tax" and accusing the Centre of yielding to US pressure.
Congress leader Rahul Gandhi had earlier alleged that the Prime Minister Narendra Modi-led government had imposed a "tax" on UPI and linked the revised MDR framework to US pressure.
Congress president Mallikarjun Kharge and senior leader Jairam Ramesh have also criticised the revised framework, while Congress General Secretary Randeep Singh Surjewala termed September 14 a "day of digital somersault" and alleged that the move would benefit American companies.
The Centre, however, has maintained that UPI transactions will remain free for consumers and that the revised MDR applies only to specified merchant transactions.