Shares of Paytm’s parent company, One 97 Communications, fell sharply on Thursday, dipping nearly 10% in early trade after the Finance Ministry dismissed rumours suggesting the reintroduction of merchant discount rate (MDR) charges on UPI transactions.
At 10:19 AM, Paytm’s stock was trading 5.27% lower at Rs 909.85 on the Bombay Stock Exchange (BSE), with intra-day lows hitting Rs 864.20 amid market uncertainty.
MDR, a fee paid by merchants for payment processing, was previously eliminated to promote cashless transactions. Recent online speculation hinted at a potential MDR charge for high-value UPI payments, leading to widespread concern.
However, in a strongly worded statement, the Finance Ministry rejected the claims, calling them misleading and causing unnecessary fear among users. The government clarified that there are no plans to impose such a fee.
Despite the volatility in Paytm’s stock, UPI transactions continue to grow. In May alone, India processed 18.68 billion transactions worth Rs 25.14 lakh crore, reinforcing the country’s dominance in global real-time payments.
Paytm, competing with PhonePe and Google Pay, remains a key player in India’s fintech space. While the Payments Council of India had earlier proposed a nominal MDR for large merchants, the government’s recent statement reinforces its stance on maintaining free UPI services.
Investors will now watch for further clarifications from regulatory bodies to assess future policy directions in the digital payments landscape.
