'End of day consumer pays': Ashneer Grover questions UPI merchant fee, says 'call it tax'

Ashneer Grover questioned the merchant charge on UPI despite the government's clarification that the move won't impact consumers.

Entrepreneur Ashneer Grover on Tuesday reacted to the recent announcement of a merchant charge on UPI transactions above ₹2,000 and said that the move does stand to ultimately impact consumers.

In a TV interview, the former BharatPe co-founder questioned the move to impose a fee on merchants accepting UPI payments above ₹2,000, despite the government's clarification that UPI payments between two individuals will remain free of charge, irrespective of the amount.

Grover argued that any levy imposed with respect to UPI payments should clearly be called a “tax”. In an interview with Times Now, Grover was asked about the argument that only those who can “afford” the fee are being asked to pay it. Shredding the logic, Grover answered: “Then call it tax. Why are you calling it a ‘charge’, ‘MDR’, or claiming that it won't affect the customer?".

Citing an example, Grover asked if one would be willing to pay ₹500 every month for breathing just because they can “afford” it. “Is there any logic to it?,” he asked. A video of his interaction went viral.

MDR, or Merchant Discount Rate, is a charge within the payment ecosystem. According to the government, it is not a tax and is not money collected by the government or NPCI.

Later in an X post, Ashneer Grover also listed some figures to question the move impose the merchant fee. Without naming the timelines of the said gains, Grover claimed that the RBI surplus to the government stood at ₹2.87 lakh crore (US$30 billion), while total listed bank profits stood at ₹4.11 lakh crore (US$42 billion).

He also said that National Payments Corporation of India (NPCI)—the operator of UPI—reported a pre-tax surplus of ₹1,888 crore (US$200 million).