UPI Stays Free for P2P and 96% of Merchant Payments

The correct answer is 2,000 rupees. Every person-to-merchant payment at or below that value stays free of the Merchant Discount Rate, and customers pay no charge for making such payments through the platform. This threshold matters because the release uses it to explain why roughly ninety six per cent of merchant transactions are untouched: they either fall below the threshold or are covered by the zero-charge arrangement for small merchants. Option A is wrong; no such limit is set in the framework. Option C and option D are wrong for the same reason, and they are the kind of round figures a candidate guesses when the exact threshold has not been memorised. Link the threshold to the rate that applies above it, which is a nominal percentage with a fixed per-transaction cap for large payments.

The correct answer is the Payment and Settlement Systems Act, 2007, the statute named in the release as the basis of the framework. The framework was brought in after detailed deliberations by the UPI Steering Committee on the rates, the operational arrangements and the safeguards for consumers. Option A is wrong because that statute governs the regulation of banks rather than payment systems. Option C is wrong because consumer protection law deals with unfair trade practices and misleading advertisements, not the design of a payment charge. Option D is wrong because the information technology statute governs electronic records and cyber offences. An aspirant should also remember that the framework is described as consistent with the recommendation of the Standing Committee on Finance about the need for a viable revenue stream.

The correct answer is a flat charge of five rupees per transaction. The release explains the reasoning: a fixed amount gives cost certainty to critical public services and to businesses that work on narrow margins, which a percentage charge would not. Option B is the general rate for merchant payments above the threshold and applies outside these named sectors, so it is the most tempting wrong answer. Option C is the far lower rate set for payments relating to mutual funds, securities, stockbrokers and dealers, meant to keep retail investors in formal financial markets. Option D is wrong because these sectors are not exempt; they simply pay a flat amount instead of a percentage. Remember the named sectors as a list, since a question may ask which of them is covered.