'No UPI Day' on October 2: Traders protest by covering QR codes with black cloth; here’s the issue

'No UPI Day' will be observed on October 2. Traders across the country will protest against the imposition of the Merchant Discount Rate (MDR) on UPI transactions. Here is the full story and the traders' demands.

No UPI Day: Several trade organizations across the country are preparing to observe 'No UPI Day' on October 2 in protest against the imposition of the Merchant Discount Rate (MDR) on UPI. During this time, traders are appealing to everyone to symbolically refrain from using UPI and to accept cash payments from customers instead.

Speaking to the news agency IANS in Mumbai, Ravindra Mangve, President of the Maharashtra Chamber of Commerce, Industry and Agriculture (MACCIA), stated that the imposition of MDR on UPI is a matter of concern. He noted that UPI has boosted digital payments in the country and stands as a source of India's digital pride. Despite this, 'No UPI Day' will be observed symbolically on October 2 to protest the levy of these charges.

What is the issue?

The government has announced changes to the UPI payment system, which had previously been free of charges for a long time. According to the government's decision, starting October 15, an MDR of 0.4 percent will be charged to merchants on UPI payments exceeding ₹2,000.

MDR is a fee charged to merchants who accept digital payments; it is not collected directly from the customer.

The government has also clarified that routine person-to-person (P2P) transactions and small payments will not fall under the ambit of this charge.

Mumbai, Maharashtra: President, MACCIA, Ravindra Mangave says, "The MDR charge imposed on UPI is an issue of concern. Because of UPI, the country has adopted a digital payment system, and UPI is our country’s digital pride. However, in protest against the MDR being imposed on… pic.twitter.com/XygLqEAKYI

— IANS (@ians_india) September 23, 2026

Why are traders protesting?

Trade organizations argue that UPI has become a vital medium for digital payments in the country. Consequently, imposing MDR on it would increase operational costs for merchants.

Trader organizations question why the additional financial burden of MDR should be placed on merchants when the revenue generated does not go directly into the government treasury.

Trade organizations in Madhya Pradesh have also staged protests as part of 'No UPI Day'. In several cities—including Indore, Bhopal, Jabalpur, Gwalior, Ratlam, Neemuch, Mandsaur, and Jaavra—traders covered their UPI QR codes with black cloth and urged customers to make cash payments.

According to Ramesh Khandelwal, President of the Ahilya Chamber of Commerce and Industry, around 125 trade associations in Indore participated in this campaign.

What did the government say?

The Ministry of Finance has stated that the MDR (Merchant Discount Rate) applicable to merchant UPI payments exceeding ₹2,000 will not impact customers. According to the ministry, no charges will be levied on customers making payments via UPI.

In other words, the proposed charge primarily concerns the payments accepted by merchants.

Decision set to take effect from October 15

According to the government's announcement, an MDR of 0.4 percent will apply to merchant UPI payments exceeding ₹2,000 starting October 15.

To protest this decision, trade associations are preparing to register their opposition by observing a 'No UPI Day' on October 2. Some trader organizations have also stated that if the decision is not withdrawn before October 15, they may continue their protests.