Economy · 26 Aug 2026

UPI Merchant Discount Rate

With reference to UPI (Unified Payments Interface), which one of the following statements is correctly matched?

AUPI was launched in August 2016 directly by the Reserve Bank of India

BThe Merchant Discount Rate (MDR) on Person-to-Merchant (P2M) UPI transactions has been zero since 2020

CUPI remains operational only within India and has not been extended to any other country

DUPI's annual transaction value first crossed ₹314 lakh crore in FY17, the year of its launch

This question is based on: The Vendor Who Never Touches Cash and the Bank That Never Touches His Money

Take this in full test mode → Instructions for 26 Aug 2026

About this question

Why in news

The Finance Ministry's tenth-anniversary release frames UPI as a pillar of India's Digital Public Infrastructure and financial inclusion, but the milestone lands as banks and payment service providers continue operating the P2M side of the network under the zero-MDR mandate that limits their direct transaction revenue.

Why for UPSC

UPI is a recurring Economy/DPI theme in Prelims and this question tests precision on commonly confused specifics - who launched it, since when MDR has been zero and its global footprint - rather than the general growth narrative everyone already knows.

Prelims summary

UPI, launched by NPCI in August 2016 and piloted by then-RBI Governor Raghuram Rajan, has carried zero MDR on P2M transactions since 2020, is now live in 11 countries and processed about ₹314 lakh crore in FY26, up from ₹0.07 lakh crore in FY17.

On web, answers are shown once after a test — no save or reattempt. For unlimited reattempts, Hindi medium, and Mentor Observations, use the TAN App.