UPI Payments: New Charges for Merchants
Consumers can breathe a sigh of relief as Unified Payments Interface (UPI) transactions remain free for them. However, a new rule effective October 15, 2026, introduces a Merchant Discount Rate (MDR) for businesses. This means merchants will pay a 0.4%
fee on UPI payments they receive above ₹2,000. This charge is to be paid by the merchant, not the customer, and passing it on to consumers is not permitted. Person-to-person (P2P) transfers and any merchant payment up to ₹2,000 will continue to have no charges. According to the National Payments Corporation of India (NPCI), these smaller transactions make up more than 95% of all UPI merchant payments, so the majority of transactions will remain unaffected.
ATM Withdrawals: Revised Limits for Some
There are important updates regarding ATM usage, particularly for State Bank of India (SBI) customers. Starting October 1, 2026, SBI has reduced the number of free transactions for its Salary Package Account holders at other banks' ATMs. The limit has been decreased from 10 to five free transactions per month, a cap that includes both financial (cash withdrawal) and non-financial (balance enquiry) transactions. For SBI's Basic Savings Bank Deposit (BSBD) accounts, the rule of four free cash withdrawals per month remains unchanged. Any withdrawal beyond this free limit will incur a charge of ₹15 plus GST. It is important to note that digital transactions remain free and unlimited.
Fixed Deposits: Greater Transparency Mandated
The Reserve Bank of India (RBI) has introduced new rules for fixed deposits, effective October 1, to increase transparency, primarily concerning bulk deposits. A bulk deposit is defined as a single term deposit of ₹3 crore or more. Under the new framework, banks are now required to publish their interest rates for these bulk deposits on their websites daily by 10:00 AM. This ensures that rates are disclosed in advance and applied uniformly across all branches for similar deposits made on the same day, preventing discriminatory pricing. While this change directly affects high-value depositors, it signals a broader push for clarity that benefits all customers by making bank practices more transparent.
LPG: Price Hikes and Subsidy Authentication
October brings a mixed bag for LPG consumers. Oil marketing companies have increased the price of 19-kg commercial LPG cylinders for the second consecutive month, with hikes ranging from ₹62.50 to ₹71.50 across major cities. In Delhi, for example, the price of a commercial cylinder has now crossed the ₹2,800 mark. However, the price of domestic 14.2-kg cylinders remains unchanged for the fifth month in a row. A significant procedural change also takes effect from October 1: mandatory biometric Aadhaar authentication is now required for consumers to receive LPG subsidies. Those who have not completed this authentication will still get cylinders but will have to pay the full market rate without the subsidy benefit.
