Congress leader Randeep Surjewala has publicly questioned the Indian government's decision to introduce Merchant Discount Rate (MDR) on select high-value UPI transactions, effective October 15. Instead of charging users or merchants, Surjewala proposed that the government should impose a substantial annual participation fee on dominant foreign-owned payment platforms operating within India's Unified Payments Interface (UPI) ecosystem.
Proposed Annual Fee for Foreign UPI Players
Surjewala suggested an annual participation fee ranging from $50 million to $100 million for major foreign companies benefiting from UPI. He specifically highlighted PhonePe and Google Pay, claiming these two American-owned entities collectively process approximately 80% of all UPI transactions in India, amounting to ₹320 lakh crore out of a total ₹400 lakh crore.
The Congress leader argued that these foreign players gain immense commercial value from the vast amounts of transaction data generated by millions of Indian users. “The Indian Govt has given technological access to American companies, and they are receiving massive volumes of data on the spending behaviour of millions of Indians. This data is itself a goldmine,” Surjewala stated.
He contended that rather than introducing MDR, which could lead to a share of the ₹5040 crore UPI transaction revenue going to these companies for the first time, an annual fee would be a more appropriate and beneficial approach for the Indian government.
Market Dominance and Data Concerns
Surjewala underscored PhonePe's significant market position, noting that the Walmart-owned company alone handles about 45% of UPI transactions. He also referenced PhonePe's halted Indian IPO in March 2026, which occurred after its valuation fell below $10 billion, suggesting that revenue generation from UPI transactions could boost such valuations in the future.
The concerns raised by Surjewala extend beyond just transaction processing fees to the broader economic implications of data collection. He emphasized that the spending patterns of millions of Indians represent a valuable asset, and the government should leverage this value from the foreign companies profiting from it.