Stocks of Paytm, YES Bank, State Bank of India (SBI), and ICICI Bank were in the limelight on Wednesday following the introduction of a new framework for MDR on selected UPI transactions. As per the new framework, an MDR of 0.4% will be levied on selected P2M UPI transactions over ₹2,000 from October 15, 2026.

The development is noteworthy for banks, payment service providers, and fintech companies since MDR forms a revenue-sharing structure among the various entities involved in the UPI payment network. The charges will be borne by merchants involved in the transaction system and not the consumers. Person to person UPI payments will continue to remain free of any charges.

Share price of Paytm was one of the gainers on Wednesday after the company raised its earnings estimates for the stock. Stocks of YES Bank also witnessed buying interest as analysts at Citi and Morgan Stanley have identified the bank as a beneficiary of the new MDR framework.

Stocks of SBI and ICICI Bank are also in focus after the decision. Banks hold an important place in the UPI system in terms of their payment-service-provider and transaction-processing capabilities. The specific financial implications that might result for each bank are dependent on their own transaction volumes and payment ecosystem share.

According to the new scheme, merchant transactions under ₹2,000 will remain free in terms of MDR. Eligible transactions above ₹2,000 will have to pay an MDR fee of 0.4%, while the charge will be limited to ₹300 in case of transaction value above ₹75,000. The framework aims at keeping normal consumers from paying any UPI transaction charge.

This development is likely to create a change in the revenue model of India’s growing digital payment system. However, merchants and payment companies will be affected by transaction value and volume along with the implementation of the framework within banks, payment aggregators and fintech platforms.

Considering that the new MDR scheme is set to become effective on October 15, investors will closely monitor further developments on the part of banks, payment companies and others involved in the UPI system.