The government is considering restoring the merchant discount rate (MDR) on certain high-value UPI transactions or introducing a tiered incentive structure to gradually reduce government support for the digital payments ecosystem, the Finance Ministry has told a Parliamentary panel. 

In a reply to the Parliamentary Standing Committee on Finance, the Department of Financial Services (DFS) has said that it was examining the two options in view of the sustainability of the Unified Payments Interface (UPI) ecosystem and the burden on the government exchequer.