Summary of this article
Madhya Pradesh petrol pumps may stop accepting UPI payments above Rs 2,000.
Dealers oppose proposed Rs 5 MDR on qualifying transactions above Rs 2,000.
Restriction may affect around 4,700 petrol pumps across Madhya Pradesh.
The new Unified Payments Interface (UPI) merchant discount rate (MDR) framework will apply to specified merchant transactions above Rs 2,000 from October 15, 2026. The MDR will be paid by merchants, while customers will not be charged the fee directly or indirectly. The development has now led petrol pump dealers in Madhya Pradesh to decide on a limit for UPI payments. Dealers have said they will stop accepting UPI payments above Rs 2,000 for petrol and diesel purchases from October 16 if the proposed MDR is not withdrawn. The decision could affect around 4,700 petrol pumps across the state.
Why Petrol Pump Dealers Are Limiting UPI Payments
Under the new framework, fuel transactions above Rs 2,000 have been placed in a category with a flat MDR of Rs 5 per transaction. Petrol pump dealers have linked their decision to the additional cost that the charge could create for fuel retailers.
According to a PTI report, Madhya Pradesh Petrol Pumps Dealers Association president Ajay Singh said the association’s members have decided not to accept UPI payments above Rs 2,000 at their fuel stations from October 16 if the government does not roll back the MDR.
Singh said a petrol pump could face an additional monthly burden of around Rs 17,700 under the new system. He added that dealers operate on relatively low margins and may not be able to absorb the additional expense.
The proposed restriction would apply to UPI payments above Rs 2,000, while lower-value UPI payments would continue to be accepted under the stated plan.
What The UPI Limit Means For Petrol Pumps
If implemented, the decision would mean affected petrol pumps in Madhya Pradesh would not accept UPI payments above Rs 2,000 for petrol and diesel purchases from October 16. Customers would need to use cash or another available payment method for higher-value transactions.
The Confederation of All India Traders (CAIT) has urged the Union government to reconsider the MDR and keep business transactions involving petrol and diesel outside its scope. CAIT Bhopal district president and Madhya Pradesh media in-charge Dharmendra Sharma said the proposed charge could affect the use of digital payments at fuel stations. Sharma said traders already operate amid costs, competition, and limited margins, and an additional payment-related expense could affect their profits.
