Are train tickets set to become more expensive? Who will pay the MDR on UPI bookings exceeding ₹2,000?

The rule regarding the Merchant Discount Rate (MDR) on UPI payments is set to come into effect on October 15. Under this rule, MDR will not apply to UPI transactions of up to ₹2,000; however, payments exceeding this amount will attract MDR charges. This has raised questions among passengers about whether they will have to bear the cost for ticket bookings exceeding ₹2,000 and whether ticket prices might rise as a result. However, the government has already clarified that the MDR will be charged to the merchant, and merchants cannot pass this cost on to the customer.

**Which MDR will apply to rail ticket bookings?**
The Railways have announced that an MDR of ₹5 will apply to UPI payments made for rail ticket bookings. However, this ₹5 charge will not be collected from passengers; instead, it will be payable by the merchant—specifically, the bank or IRCTC. Under the new MDR system, railway ticketing has been placed in a special category alongside sectors such as telecom, insurance, fuel, and utility payments. For these categories, the MDR has been fixed at a flat fee of ₹5.

**Will train tickets become more expensive?**
The Railways has clarified that the MDR applicable to UPI payments will not be recovered from passengers. If you book a ticket worth ₹10,000 and pay via UPI, you will only have to pay ₹10,000. The Railways will charge the same fees as before, without adding any extra MDR charges.

It is worth noting that the Ministry of Finance has advised banks to ensure that merchants do not pass the burden of this charge on to customers.

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