The debate over Merchant Discount Rate (MDR) on UPI payments has taken a new turn, with the government and Opposition now disagreeing over what was actually discussed and approved by the Parliamentary Standing Committee on Finance.
The dispute centres on the committee’s 44th Action Taken Report. Government sources are pointing to the report’s recommendation for a tiered MDR or revenue-sharing system, saying Opposition members did not formally record their dissent when the report was adopted.
Congress MPs, however, have rejected the interpretation. They say the committee may have discussed the broader issue of MDR, but the specific UPI fee structure recently announced by the government was never presented before the panel.
Government Says No Formal Dissent Was Recorded
Government sources have highlighted the proceedings surrounding the adoption of the committee report.
According to the government’s account, Congress MPs P Chidambaram, Manish Tewari, Gaurav Gogoi, Kishori Lal and K Gopinath were present when the report was adopted.
The government says no formal dissent from these members was recorded in the published proceedings.
It is using this point to challenge the Opposition’s criticism of the government’s decision on UPI MDR. Its argument is that the committee had already recommended moving towards a tiered framework.
However, the Opposition says the recommendation in the report should not be treated as approval of the particular MDR system that the government has now announced.
Congress Says Specific UPI MDR Plan Was Not Discussed
Congress MP Gaurav Gogoi, who was part of the Finance Committee, has said the proposal now at the centre of the controversy was not placed before the panel.
Gogoi said the Department of Financial Services did not have a specific proposal of this nature when it appeared before the committee.
He also said committee members had questioned the need for MDR and its effectiveness but did not receive satisfactory answers from government officials.
Congress MP Manish Tewari has supported Gogoi’s version of events.
Tewari said the MDR framework that is scheduled to come into effect from October 15 was not presented to committee members.
According to Tewari, MPs were not given details about the proposed MDR rate, fee amount, ceiling or exemption slabs.
He also said members had raised broader questions about the need and effectiveness of MDR during the committee’s discussions.
Tewari further said that using the names of individual MPs to suggest that they supported the specific proposal was an inaccurate description of confidential parliamentary committee proceedings.
Opposition MP Claims Amendments Were Suggested
An Opposition member of the committee, speaking to India Today on condition of anonymity, claimed that concerns about the MDR recommendation were raised by MPs from different parties.
The MP said, “A lot of concerns were raised by members, and this included both Opposition and BJP MPs. We had also stated that this particular recommendation needed to be amended.”
The MP also alleged that committee chairman Bhartruhari Mahtab referred to the limited time available to complete the report.
“The Chairman said that the report had to be submitted and that he did not have much time. It required printing and everything. He then went ahead without incorporating those recommendations and submitted the report,” the MP alleged.
The allegation has not been independently established.
What Is the Actual Point of Dispute?
The controversy largely comes down to the difference between a broad recommendation on MDR and the specific UPI framework now being proposed.
The government is relying on the Finance Committee’s recommendation for a tiered MDR or revenue framework. It says the recommendation was adopted without a formal dissent being recorded by the Congress MPs who were present.
The Congress MPs are drawing a distinction between that broad recommendation and the current proposal.
They say the committee was not given the specific details of the new system, including the rate, fee structure, maximum charges and exemptions. Therefore, they argue that the committee’s earlier recommendation cannot automatically be treated as approval of the current UPI MDR proposal.
The disagreement has now brought the functioning and proceedings of the parliamentary panel into the wider political debate over UPI charges.
At the heart of the issue is a simple question: did the Finance Committee approve the specific MDR model now being brought in, or did it only discuss the broader possibility of creating a tiered system?
The government and Opposition currently have different answers to that question.
