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UPI vs. Cards: Which Payment Method Saves You More on a ₹10,000 Bill?
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News18•23-09-2026, 16:45
UPI vs. Cards: Which Payment Method Saves You More on a ₹10,000 Bill?
- •UPI has transformed retail, with its QR codes prevalent from small shops to large stores due to ease and lower cost for merchants.
- •Card payments incur monthly rent for POS machines, maintenance, and higher transaction fees for shopkeepers.
- •Credit card MDR can range from 1.5% to 2.5%, while debit card MDR is around 0.90%.
- •A ₹10,000 bill costs ₹200-₹250 via credit card, ₹90-₹100 via debit card, but only ₹40 via UPI.
- •UPI transactions up to ₹2,000 are completely free of MDR, benefiting small businesses significantly.
Key Questions Answered
For a ₹10,000 transaction, a credit card can cost the shopkeeper ₹200 to ₹250, a regular debit card costs about ₹90 to ₹100, while UPI incurs a much lower nominal cost of ₹40.
For person-to-merchant UPI transactions exceeding ₹2,000, the Merchant Discount Rate is capped at a maximum of 0.4%, subject to a limit of ₹300.
Yes, all UPI merchant transactions up to ₹2,000 remain completely free with no MDR or GST levied, and businesses with monthly UPI receipts up to ₹1 lakh are also exempt from MDR.
