MDR on UPI: Keralam hotels association says will stop accepting UPI payments above ₹2,000 from October 15

The Kerala Hotel and Restaurant Association (KHRA) on Tuesday (October 13, 2026) announced that its members will stop accepting UPI payments above ₹2,000 from October 15, following the introduction of a 0.4% UPI merchant discount rate (MDR) framework, which it says will impose an additional financial burden on small establishments. Customers will have to pay in cash for transactions above ₹2,000, said KHRA president G. Jayapal.

“The industry is already suffering from the rising cost of raw materials. We feel cheated, especially since we were all encouraged to shift to digital payments and are now being charged extra for them. This will put an additional financial burden on us. The industry is already going through a difficult time due to rising prices, and this will plunge us further into a financial crisis,” said Mr. Jayapal.

In a joint statement, KHRA president Mr. Jayapal and general secretary N. Abdul Razak noted that UPI was widely used across the hotel and restaurant industry. Additional charges for digital payments would affect the industry, especially hotels and lodges, Mr. Jayapal said.

“Either the extra charges should be scrapped, or the limit should be raised to ₹10,000 from ₹2,000,” he said.