Module: General Practice
Q107: Consider the following statements regarding RuPay Credit Cards on UPI:
Assertion (A): Small merchants (Person-to-Merchant or P2M) generally do not pay any Merchant Discount Rate (MDR) for UPI transactions under ₹2,000, even if the customer uses a RuPay Credit Card.
Reason (R): The NPCI and RBI have categorized small value transactions (<₹2,000) on RuPay Credit Card-UPI linkage as "Zero MDR" to promote adoption among small vendors who traditionally reject credit cards.
Reason (R): The NPCI and RBI have categorized small value transactions (<₹2,000) on RuPay Credit Card-UPI linkage as "Zero MDR" to promote adoption among small vendors who traditionally reject credit cards.
✅ Correct Answer: A
🎯 Quick Answer:
Both statements are true and causally linked.The Problem: Merchants love UPI (Zero cost) but hate Credit Cards (approx.
2% cost). The Solution (Linkage): To make "Credit on UPI" work, the NPCI waived the interchange/MDR for transactions up to ₹2,000.
Above ₹2,000: Standard credit card MDR applies (approx 2%). Below ₹2,000: Kept free for the merchant to ensure they don't disable the "Credit Card" option on their QR codes.