Lok Sabha passes Bill to authorise Govt. to permit banks to levy charges on UPI transactions
Lok Sabha on Thursday (August 6, 2026) passed a Bill to amend the Payment and Settlement Systems Act, 2007 that authorises the government to permit banks and other service providers to levy charges on payments through unified payments interface (UPI) and other notified electronic payment modes. The Taxation and other Laws (Amendment) Bill w through which the government also amended the Payment and Settlement Systems Act, 2007, was passed without a debate due to persistent sloganeering by the Opposition over various issues, including alleged theft of donation at the Ram temple in Ayodhya. The amendment seeks to remove the existing legal provision that prevents banks and payment service providers from charging Merchant Discount Rate (MDR) on notified electronic payment modes. Real-time payments made through RTGS and NEFT are done by paying a service charge. However, UPI transactions have been exempted from such charges so far. The proposed changes in Payment and Settlement Systems Act is a part of comprehensive legislation on taxation, which was introduced in the House on Tuesday (August 4, 2026). The Bill was …









