APSC Current Affairs: Assam Tribune Notes with MCQs and Answer Writing (12/10/2026)
For APSC CCE and other Assam competitive exam aspirants, staying consistently updated with reliable current affairs is essential for success. This blog provides a well-researched analysis of the most important topics from The Assam Tribune dated 12 October 2026. Each issue has been carefully selected and explained to support both APSC Prelims and Mains preparation, ensuring alignment with the APSC CCE syllabus and the evolving trends of the examination.
✨ APSC CCE Foundation Course, 2026
Constitutional Validity of the Death Penalty in India
Syllabus Mapping
- GS Paper II: Constitution, Judiciary, and Criminal Justice
- GS Paper IV: Ethics, Justice, and Human Dignity
- Why in News: The Supreme Court recently dismissed a petition (Rishi Malhotra v. Union of India) seeking to replace execution by hanging with alternatives like lethal injection, leaving future reviews open to scientific evidence.
Introduction
Capital punishment in India remains constitutionally valid but is heavily restricted to the “rarest of rare” cases, with the Supreme Court recently reaffirming hanging as the lawful execution method while rejecting unproven alternatives.
Prelims Perspective
- Recent Judgment (Aug 2026): Rishi Malhotra v. Union of India upheld hanging as the mode of execution, finding alternatives like lethal injection scientifically unconvincing.
- Rarest of Rare Doctrine: Established in Bachan Singh v. State of Punjab (1980); dictates that death penalty is an exception and life imprisonment is the rule.
- Mandatory Death Penalty: Struck down as unconstitutional in Mithu v. State of Punjab (1983) (invalidated IPC Section 303).
- Validity of Hanging: Originally upheld in Deena v. Union of India (1983).
- Statutory Framework (BNSS 2023):
- Section 393(3): Mandates courts to record special reasons for imposing a death sentence.
- Section 393(5): Prescribes execution by hanging by the neck until death.
- Constitutional Articles:
- Article 14 & 21: Equality, protection against arbitrariness, and the right to a dignified legal procedure.
- Article 72: Clemency powers of the President.
- Article 161: Clemency powers of the Governor.
- Law Commission Reports:
- 35th Report (1967): Supported retention of the death penalty.
- 187th Report (2003): Considered alternatives to hanging.
- 262nd Report (2015): Recommended abolishing the death penalty for all crimes except terrorism and waging war.
Mains Perspective
- Arguments Supporting Retention
- Proportionate Justice: Serves as a necessary retributive measure for exceptionally heinous crimes that cause extreme harm to society.
- Judicial Safeguards: The rarest of rare doctrine and statutory mandates for “special reasons” prevent the arbitrary imposition of death sentences.
- Arguments Against the Death Penalty
- Irreversibility: Completely forecloses the possibility of rehabilitation or correcting wrongful convictions caused by investigative flaws.
- Unequal Application: Disproportionately affects socio-economically marginalized individuals due to disparities in legal representation.
- Ethical & Procedural Challenges
- Dignity vs. Punishment: State-sanctioned execution tests the ethical duty of non-maleficence (avoiding unnecessary suffering) against lawful punishment.
- Systemic Distress: Subjective sentencing discrepancies and prolonged death-row trauma cause severe psychological suffering.
- Institutional Safeguards
- Multi-layered Scrutiny: Sentences are subjected to mandatory statutory confirmation, rigorous appellate review, and ultimate constitutional clemency.
- Legal & Policy Support: The legal services framework ensures representation, while Law Commission reviews constantly guide penal reforms.
- Way Forward
- Evidence-Based Review: Commission multidisciplinary scientific research involving forensic medicine and neuroscience to evaluate the humaneness of execution methods.
- Systemic Integrity: Strengthen forensic capacities to prevent wrongful convictions and implement transparent, delay-free clemency protocols.
Conclusion
India’s capital punishment framework must continuously balance the demands of retributive justice for extreme crimes with evolving constitutional standards of human dignity, scientific evidence, and procedural fairness.
UPI MDR Framework Needs Rationalisation to Protect Public Trust
Syllabus Mapping
- GS Paper III: Indian Economy, financial inclusion, and digital infrastructure.
- GS Paper V: Assam’s economic development and digital inclusion.
- Why in News: An IIT Bombay report, UPI at a Crossroads: Reintroducing the MDR, recommends rationalizing the newly introduced Merchant Discount Rate (MDR) for UPI transactions to balance ecosystem sustainability with public affordability.
Introduction
A sustainable digital payment ecosystem requires a balanced fee structure that funds infrastructure upgrades without shifting the cost burden onto everyday users and vulnerable small businesses.
Prelims Perspective
- Report Name: UPI at a Crossroads: Reintroducing the MDR published by IIT Bombay.
- MDR (Merchant Discount Rate): The fee paid by a merchant to the acquiring bank or payment service provider for processing a digital transaction.
- UPI (Unified Payments Interface): Launched in 2016 and operated by the NPCI (National Payments Corporation of India).
- Regulatory Body: Overseen by the RBI under the Payment and Settlement Systems Act, 2007.
- New NPCI Circular: Issued on 15 September 2026 (effective 15 October 2026), ending the zero-MDR era for specific transactions.
- Reported UPI Fee Structure:
- 0.4% MDR: Applied to specified P2M (person-to-merchant) transactions above ₹2,000.
- Capped at ₹300: For high-value transactions of ₹75,000 or more.
- Flat ₹5 Charge: For railways, telecom, fuel, and insurance payments above ₹2,000.
- 0.02% (Capped at ₹300): For capital-market transactions like mutual funds and stockbroking.
- Strictly Free: Person-to-person (P2P) transfers and most everyday small merchant payments.
- IIT Bombay Recommendations: Confine MDR largely to merchants with an annual turnover above ₹50 crore (covering ~90% of proposed revenue), impose fees on online e-commerce transactions, and completely exempt loan EMIs and debt collections.
Mains Perspective
- Importance of UPI & Funding Needs
- Acts as a vital digital public infrastructure that drives financial inclusion, economic formalisation, and productivity.
- Requires a viable funding model to maintain cybersecurity, ensure service quality, and prevent over-reliance on subsidies.
- Challenges Associated with MDR
- Introducing fees risks breaking public trust, potentially forcing cost-sensitive consumers and vulnerable small merchants back to cash.
- Fees on loan repayments increase friction for borrowers, while merchant transaction costs may be indirectly passed on to consumers.
- Requires strict regulatory clarity to define transaction exemptions, oversight roles, and exact fee liabilities to avoid market confusion.
- Way Forward & Assam-Specific Relevance
- Adopt proportionate pricing that targets large online and offline merchants while strictly exempting small businesses, loan EMIs, and debt collections.
- Ensure transparency and regulatory clarity by clearly defining the roles of the RBI and NPCI while actively monitoring the fee impact on digital adoption.
- For Assam, a balanced framework is critical to sustain digital adoption among rural enterprises, street vendors, and self-help groups without hurting their thin profit margins.
Conclusion
India’s UPI policy must seamlessly harmonize the financial viability of payment service providers with the core national goals of public affordability, digital inclusion, and frictionless commerce.
Ahimsa Eri Silk Gaining Ground in Global Market
Syllabus Mapping
- GS Paper III: Assam’s economy, traditional industries, rural livelihoods, and sustainable development.
- GS Paper V: Assam’s economy, culture, and traditional crafts.
- Why in News: Assam’s non-violent ‘Ahimsa’ or Peace eri silk is experiencing surging demand in international markets like the USA, France, and Japan due to its ethical, cruelty-free production.
Introduction
Assam’s traditional Ahimsa Eri silk is emerging as a highly sought-after sustainable textile globally, seamlessly blending cultural heritage with the booming ethical fashion market.
Prelims Perspective
- Silk Variety: Eri silk, a traditional silk indigenous to Assam and Northeast India.
- Ahimsa/Peace Silk: Produced via a non-violent process that allows the silkworm moth to emerge naturally from the cocoon unharmed.
- Global Demand: Gaining significant traction among designers in the USA, France, and Japan and ethical consumer bases, including Buddhist communities.
- Product Diversification: Expanding beyond traditional uses into shawls, scarves, table runners, shirts, and women’s garments.
- Institutional Framework: Supported by the Central Silk Board and its Central Muga Eri Research and Training Institute [Note: This institute is located at Lahdoigarh, Jorhat, Assam].
- Crucial Distinction: Not all Eri silk is Ahimsa silk; commercial extraction may involve forcibly removing the pupa, making verifiable certification mandatory.
Mains Perspective
- Importance
- Economic & Rural Growth: Premium pricing for ethical textiles directly boosts incomes and sustains rural livelihoods for local rearers, spinners, and weavers.
- Export Potential & Sustainability: Perfectly aligns with the global shift towards cruelty-free fashion, opening lucrative niche international markets.
- Cultural Branding: Elevates Assam’s traditional sericulture and handloom identity on the global stage.
- Challenges
- Quality & Verification: A severe lack of standardized certification makes it difficult to distinguish genuine Ahimsa silk from conventionally processed Eri silk.
- Supply Chain Constraints: Inconsistent supply, limited production capacity, and weak international branding hamper large-scale commercialization.
- Producer Equity: A high risk exists that the premium profits from global commercialization may not trickle down to the primary grassroots producers.
- Government Initiatives
- Institutional Backing: The Central Silk Board and the Central Muga Eri Research and Training Institute provide foundational R&D, training, and sericulture development.
- Policy Gap: There is currently no dedicated, specific government scheme exclusively targeting the promotion and certification of Ahimsa Eri silk.
- Way Forward
- Standardized Certification: Institute strict, transparent traceability and quality assurance mechanisms to verify the cruelty-free origin of the silk.
- Premium Value Addition: Pivot from basic fabrics to high-end fashion garments and forge strategic partnerships with global ethical brands.
- Empowering Producers: Establish robust market linkages to ensure primary weavers and rearers receive fair, equitable remuneration for their craftsmanship.
Conclusion
Capitalizing on the global appeal of Ahimsa Eri silk requires robust certification frameworks and targeted export promotion to transform Assam’s ethical sericulture into a powerful engine for rural economic growth.
Government Releases Draft National Steel Policy 2047
Syllabus Mapping
- GS Paper III: Indian Economy, industrial development, infrastructure, energy, and environment.
- GS Paper V: Assam’s economy and industrial development.
- Why in News: The Ministry of Steel released the draft National Steel Policy — Vision 2047 for public consultation, aiming to expand India’s crude steelmaking capacity to 604 million tonnes by 2047.
Introduction
The draft Vision 2047 aims to drastically expand India’s steelmaking capacity while actively addressing the critical challenges of carbon emissions and heavy dependence on imported raw materials.
Prelims Perspective
- Nodal Ministry: Ministry of Steel, Government of India.
- Previous Policy: National Steel Policy 2017 (targeted 300 million tonnes of crude steel capacity by 2030–31).
- India’s Global Rank: World’s second-largest crude steel producer.
- Current Capacity: Approximately 220 million tonnes per annum.
- 2047 Proposed Targets:
- Crude Steel Capacity: 604 million tonnes.
- Finished Steel Consumption: 505 million tonnes.
- Per-Capita Consumption: 302 kg.
- Steel Exports: 45 million tonnes.
- Carbon-Emission Intensity: Reduce from 2.54 to 1.54 tonnes of CO₂ per tonne of crude steel.
- Coking Coal Deficit: India imports approximately 92% of its required coking coal, a crucial steelmaking input.
- National Net-Zero Target: 2070.
- Key Distinction: Crude steel capacity reflects maximum production capability, not actual production or finished consumption.
Mains Perspective
- Importance
- Economic & Employment Engine: Acts as the backbone for infrastructure, manufacturing, and transport, driving widespread job creation across logistics and mining.
- Strategic Self-Reliance: Strengthening domestic production reduces vulnerability to global supply shocks and enhances export competitiveness.
- Green Transition: Scaling low-carbon steelmaking is essential to harmonize rapid industrial growth with India’s long-term climate commitments.
- Challenges
- Import Vulnerability: Massive reliance on imported coking coal exposes the domestic industry to volatile global prices and geopolitical disruptions.
- Decarbonisation Costs: Transitioning from conventional coal-based processes to cleaner technologies (green hydrogen, carbon capture) requires massive, sustained capital investment.
- Resource & MSME Strain: Tripling production will severely pressure domestic resources (iron ore, water, energy), while small secondary producers struggle to finance modernization.
- Government Initiatives
- National Steel Policy 2017: Established the foundational roadmap for sectoral development and capacity expansion.
- PLI Scheme for Specialty Steel: Incentivizes domestic production of high-value, import-substitute steel grades.
- Draft Vision 2047: Proposes a unified, long-term framework integrating raw-material security, green steel initiatives, and circular economy practices.
- Way Forward
- Raw Material Security: Aggressively diversify coking-coal imports, acquire overseas assets, and invest heavily in domestic coal-washing and blending capabilities.
- Green Modernization: Accelerate the adoption of renewable energy, scrap recycling, and indigenous manufacturing of green steelmaking equipment.
- Inclusive & Sustainable Growth: Provide targeted financial and technological support to secondary steel units while enforcing strict environmental and responsible mining standards.
Conclusion
Achieving the ambitious Vision 2047 targets requires India to seamlessly balance massive industrial expansion with strategic raw-material security, inclusive financial support, and credible decarbonisation efforts.
APSC MCQs
Topic 1: Constitutional Validity of the Death Penalty in India
Q1. Consider the following statements regarding the judicial precedents related to the death penalty in India:
- The ‘rarest of rare’ doctrine was established by the Supreme Court in the Bachan Singh v. State of Punjab case.
- The Supreme Court upheld mandatory capital punishment under Section 303 of the IPC in the Mithu v. State of Punjab case.
- The recent Rishi Malhotra v. Union of India (2026) judgment abolished execution by hanging in favour of lethal injection.
How many of the above statements are correct?
- (a) Only one
- (b) Only two
- (c) All three
- (d) None
Answer: (a) Only one Explanation: Only statement 1 is correct. Statement 2 is incorrect because the Supreme Court struck down (invalidated) the mandatory death penalty in the Mithu case. Statement 3 is incorrect because the Rishi Malhotra case upheld hanging and dismissed the petition for alternative methods.
Q2. Consider the following statements regarding the statutory and constitutional framework of the criminal justice system in India:
- Section 393(3) of the Bharatiya Nagarik Suraksha Sanhita (BNSS), 2023 mandates that a judgment imposing a death sentence must state special reasons for the sentence.
- Under Article 161 of the Constitution, the Governor has the power to grant pardons and commute sentences, including matters within the state’s executive sphere.
Which of the statements given above is/are correct?
- (a) 1 only
- (b) 2 only
- (c) Both 1 and 2
- (d) Neither 1 nor 2
Answer: (c) Both 1 and 2 Explanation: Both statements are correct as per the new BNSS provisions and the constitutional clemency powers granted to the Governor under Article 161.
Q3. Consider the following pairs of Law Commission Reports and their recommendations regarding capital punishment:
- 35th Report (1967) : Supported the retention of the death penalty.
- 187th Report (2003) : Recommended mandatory death sentences for heinous crimes.
- 262nd Report (2015) : Recommended abolishing the death penalty for all crimes without any exceptions.
How many pairs given above are correctly matched?
- (a) Only one pair
- (b) Only two pairs
- (c) All three pairs
- (d) None of the pairs
Answer: (a) Only one pair Explanation: Only pair 1 is correctly matched. Pair 2 is incorrect because the 187th report examined alternatives to hanging. Pair 3 is incorrect because the 262nd report recommended abolition for all crimes except terrorism-related offences and waging war.
Q4. Statement I: Article 21 of the Indian Constitution automatically invalidates every form of capital punishment because it protects life and personal liberty.
Statement II: The constitutional validity of the death penalty is maintained because the deprivation of life follows a procedure established by law that satisfies constitutional standards of fairness.
Which one of the following is correct in respect of the above statements?
- (a) Both Statement I and Statement II are correct and Statement II is the correct explanation for Statement I.
- (b) Both Statement I and Statement II are correct but Statement II is not the correct explanation for Statement I.
- (c) Statement I is correct but Statement II is incorrect.
- (d) Statement I is incorrect but Statement II is correct.
Answer: (d) Statement I is incorrect but Statement II is correct. Explanation: Article 21 protects life and liberty but does not automatically invalidate capital punishment. The death penalty is valid because it is carried out following a fair procedure established by law, making Statement II correct and I incorrect.
Topic 2: UPI MDR Framework Needs Rationalisation to Protect Public Trust
Q5. In the context of digital payments in India, which of the following best describes the ‘Merchant Discount Rate’ (MDR)?
- (a) A cashback incentive provided by the RBI to consumers for using digital transactions.
- (b) The fee paid by a merchant to the acquiring bank or payment service provider for processing a digital payment.
- (c) A tax levied by the central government on all peer-to-peer digital money transfers.
- (d) A discount offered by online e-commerce platforms to customers using credit cards.
Answer: (b) The fee paid by a merchant to the acquiring bank or payment service provider for processing a digital payment. Explanation: MDR is the fee associated with processing a digital payment, generally paid by the merchant to the acquiring bank to compensate the payment ecosystem participants.
Q6. With reference to the Unified Payments Interface (UPI), consider the following statements:
- UPI is operated by the Reserve Bank of India (RBI) directly.
- The regulatory oversight of UPI falls under the Payment and Settlement Systems Act, 2007.
Which of the statements given above is/are correct?
- (a) 1 only
- (b) 2 only
- (c) Both 1 and 2
- (d) Neither 1 nor 2
Answer: (b) 2 only Explanation: Statement 1 is incorrect because UPI is operated by the National Payments Corporation of India (NPCI), not directly by the RBI. Statement 2 is correct as the RBI provides regulatory oversight under the Payment and Settlement Systems Act, 2007.
Q7. According to the recommendations of the IIT Bombay report titled “UPI at a Crossroads”, consider the following statements:
- MDR should be restricted primarily to large merchants with an annual turnover of ₹50 crore or more.
- Loan EMI repayments and debt-collection transactions should attract a higher MDR to cross-subsidize small merchants.
- Person-to-person (P2P) transfers should be brought under the MDR framework.
How many of the above recommendations were made in the report?
- (a) Only one
- (b) Only two
- (c) All three
- (d) None
Answer: (a) Only one Explanation: Only statement 1 is correct. The report recommends keeping loan EMI repayments completely free (rejecting statement 2) and keeping P2P transfers free (rejecting statement 3).
Q8. Consider the following transaction categories under the newly reported NPCI UPI MDR framework (September 2026):
- Specified person-to-merchant (P2M) transactions above ₹2,000.
- High-value transactions of ₹75,000 or more under the general rate.
- Person-to-person (P2P) transfers.
How many of the above categories are proposed to remain strictly free from MDR charges?
- (a) Only one
- (b) Only two
- (c) All three
- (d) None
Answer: (a) Only one Explanation: Only P2P transfers (category 3) remain free. Specified P2M transactions above ₹2,000 attract a 0.4% MDR, and high-value transactions above ₹75,000 are capped at a ₹300 fee.
Topic 3: Ahimsa Eri Silk Gaining Ground in Global Market
Q9. Consider the following statements regarding Eri Silk:
- It is a traditional silk indigenous primarily to Assam and Northeast India.
- Every Eri silk product automatically qualifies as Ahimsa silk because of the region it is grown in.
Which of the statements given above is/are correct?
- (a) 1 only
- (b) 2 only
- (c) Both 1 and 2
- (d) Neither 1 nor 2
Answer: (a) 1 only Explanation: Statement 1 is correct. Statement 2 is incorrect because not every Eri silk product qualifies as Ahimsa silk; commercial extraction may involve forcibly removing the pupa. The specific non-violent production process determines if it is Ahimsa silk.
Q10. What specifically distinguishes “Ahimsa Silk” (or Peace Silk) from conventionally processed silk?
- (a) It is woven entirely by hand without the use of electricity.
- (b) It is produced using a process that allows the silkworm moth to emerge naturally from the cocoon unharmed.
- (c) It is dyed using only organic, plant-based non-toxic colours.
- (d) It is heavily subsidized by the government for below-poverty-line weavers.
Answer: (b) It is produced using a process that allows the silkworm moth to emerge naturally from the cocoon unharmed. Explanation: The defining characteristic of Ahimsa or Peace silk is its cruelty-free production process where the moth is allowed to emerge naturally before the cocoon is processed.
Q11. The Central Muga Eri Research and Training Institute provides the institutional base for research and development of this traditional sericulture. It operates under the administrative control of which of the following bodies?
- (a) Indian Council of Agricultural Research (ICAR)
- (b) Ministry of Development of North Eastern Region (DoNER)
- (c) Central Silk Board
- (d) Khadi and Village Industries Commission (KVIC)
Answer: (c) Central Silk Board Explanation: The Central Muga Eri Research and Training Institute operates under the Central Silk Board, providing foundational support for sericulture development.
Q12. Statement I: Ahimsa Eri silk has significant export potential in international markets like the USA, France, and Japan.
Statement II: There is a highly standardized and globally recognized uniform certification process in India that easily distinguishes Ahimsa silk from conventional Eri silk.
Which one of the following is correct in respect of the above statements?
- (a) Both Statement I and Statement II are correct and Statement II is the correct explanation for Statement I.
- (b) Both Statement I and Statement II are correct but Statement II is not the correct explanation for Statement I.
- (c) Statement I is correct but Statement II is incorrect.
- (d) Statement I is incorrect but Statement II is correct.
Answer: (c) Statement I is correct but Statement II is incorrect. Explanation: Statement I is true as there is high global demand. Statement II is incorrect because one of the major challenges facing the industry is the exact opposite: a lack of standardized certification and traceability for Ahimsa silk.
Topic 4: Government Releases Draft National Steel Policy 2047
Q13. With reference to the Draft National Steel Policy — Vision 2047, consider the following proposed targets:
- Expanding India’s crude steel capacity to 604 million tonnes.
- Reducing carbon-emission intensity from 2.54 to 1.54 tonnes of CO2 per tonne of crude steel.
- Achieving a net-zero emission target for the steel industry by 2047.
How many of the above targets are specifically proposed in the draft policy?
- (a) Only one
- (b) Only two
- (c) All three
- (d) None
Answer: (b) Only two Explanation: Targets 1 and 2 are correct. Target 3 is incorrect because India’s national net-zero target is 2070, and the draft policy does not mandate net-zero for the steel industry by 2047.
Q14. Consider the following statements regarding the raw material security of the Indian steel industry:
- India currently imports approximately 92% of its coking coal requirements.
- India is entirely self-sufficient in coking coal and only imports iron ore.
- The Vision 2047 draft policy proposes diversifying coking-coal imports and improving domestic coal-washing capabilities.
How many of the above statements are correct?
- (a) Only one
- (b) Only two
- (c) All three
- (d) None
Answer: (b) Only two Explanation: Statements 1 and 3 are correct. Statement 2 is incorrect because India is heavily dependent on imported coking coal (not self-sufficient).
Q15. In the context of India’s steel manufacturing sector, which of the following government initiatives is specifically aimed at encouraging the domestic production of higher-value, import-substitute steel grades?
- (a) PM GatiShakti
- (b) Make in India 2.0
- (c) Production Linked Incentive (PLI) Scheme for Specialty Steel
- (d) National Infrastructure Pipeline
Answer: (c) Production Linked Incentive (PLI) Scheme for Specialty Steel Explanation: The PLI Scheme for Specialty Steel is the specific government initiative designed to encourage domestic manufacturing of high-value specialty steel.
Q16. Consider the following statements:
- India is currently the world’s largest producer of crude steel.
- “Crude steel capacity” represents a country’s actual annual finished steel consumption. Which of the statements given above is/are correct?
- (a) 1 only
- (b) 2 only
- (c) Both 1 and 2
- (d) Neither 1 nor 2
Answer: (d) Neither 1 nor 2 Explanation: Statement 1 is incorrect because India is the world’s second-largest crude steel producer. Statement 2 is incorrect because crude steel capacity is the maximum production capability, which is distinct from actual production or finished-steel consumption.
Daily APSC Mains Answer Writing
Q. UPI has emerged as a critical component of India’s digital public infrastructure. Discuss the challenges of ensuring its financial sustainability while preserving affordability, financial inclusion and public trust. (15 Marks, 250 Words)
Accounting for nearly 46% of global real-time digital transactions, UPI is the backbone of India’s Digital Public Infrastructure, directly advancing SDG 8 (Decent Work and Economic Growth) and SDG 9 (Innovation).
1. The Need for Financial Sustainability (Why MDR is Required)
- Infrastructure Costs: Banks and Payment Service Providers (PSPs) incur heavy costs for server maintenance, cybersecurity, and tech innovation.
- Systemic Viability: A zero Merchant Discount Rate (MDR) model is unviable long-term, risking service degradation and over-dependence on government subsidies.
- Recent Context: The IIT Bombay Report (UPI at a Crossroads) and recent NPCI circulars suggest introducing a rationalized MDR (e.g., 0.4% on specific high-value P2M transactions) to fund the ecosystem.
2. Multi-Dimensional Challenges (Stakeholder-Based Analysis)
- Consumers (Public Trust & Affordability): Users accustomed to free transactions fear indirect cost pass-throughs by merchants. Any perceived penalty on digital payments risks a behavioral shift back to cash.
- Small & Micro Merchants: Thin-margin businesses (Example: Local street vendors and self-help groups in Assam) cannot absorb transaction fees, directly threatening grassroots economic formalization.
- Borrowers (Financial Inclusion): Levying MDR on loan EMIs and micro-finance debt collections increases friction for vulnerable borrowers, defeating the core purpose of financial inclusion.
- Regulators (RBI/NPCI): Balancing the Payment and Settlement Systems Act, 2007 mandates—ensuring a profitable business model for PSPs without violating the mandate of accessible public goods.
3. Strategic Way Forward (Balancing Sustainability and Inclusion)
| Approach Area | Proposed Intervention |
| Proportionate Pricing | Confine MDR strictly to large merchants (e.g., >₹50 crore turnover) and online e-commerce giants. |
| Targeted Exemptions | Keep Person-to-Person (P2P) transfers, small retail P2M, and loan EMIs strictly fee-free. |
| Regulatory Transparency | RBI and NPCI must enforce clear, transparent guidelines preventing hidden fee pass-throughs to retail consumers. |
| Alternative Funding | Explore data-monetization (with strict privacy safeguards) and cross-selling financial products as revenue streams for PSPs. |
Transitioning to a tiered, evidence-based MDR framework will ensure UPI remains a sustainable Digital Public Good, seamlessly balancing the operational viability of service providers with the financial inclusion of the masses.
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