Up to what value do merchant payments through UPI remain free of MDR under the new framework?
- A.1,000 rupees
- B.2,000 rupees
- C.5,000 rupees
- D.10,000 rupees
Correct answer
Explanation
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.
Read the full article: UPI Stays Free for P2P and 96% of Merchant Payments
Practice Questions
Under which law has the new UPI framework been introduced?
- A.Banking Regulation Act, 1949
- B.Payment and Settlement Systems Act, 2007
- C.Consumer Protection Act, 2019
- D.Information Technology Act, 2000
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The framework was brought in after detailed deliberations by the UPI Steering Committee on the rates, the operational arrangements and the safeguards for consumers.
Read the full explanation →What MDR applies to UPI transactions above 2,000 rupees in essential and thin-margin sectors such as railways, telecom and insurance?
- A.A flat charge of 5 rupees per transaction
- B.0.4 per cent of the transaction value
- C.0.02 per cent of the transaction value
- D.No charge at all
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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.
Read the full explanation →On which stock exchanges is the equity share capital of the acquirer listed?
- A.Only the National Stock Exchange of India
- B.Only the Bombay Stock Exchange
- C.The Bombay Stock Exchange and the National Stock Exchange of India
- D.The Calcutta Stock Exchange and the Bombay Stock Exchange
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Kotak Mahindra Bank is described as a scheduled commercial bank licensed by the central bank to carry on banking business, with its equity share capital listed on both these exchanges.
Read the full explanation →Which regulator approved the acquisition of a part of Deutsche Bank India business by Kotak Mahindra Bank?
- A.Securities and Exchange Board of India
- B.Reserve Bank of India
- C.Competition Commission of India
- D.Insurance Regulatory and Development Authority of India
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The competition regulator cleared the proposed combination, which covers both the purchase of the target business and the related referral arrangements between affiliates of the two sides.
Read the full explanation →Which business of Deutsche Bank in India is being acquired by Kotak Mahindra Bank?
- A.Corporate and investment banking
- B.Retail, private banking and wealth management
- C.Custody and fund accounting
- D.Treasury and foreign exchange dealing room
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The target business is precisely the retail banking and private banking segment together with the wealth management arm that the seller runs through its branches in India, and it is moving as a going concern on a slump sale basis.
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