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Calculate the MDR fee, GST on that fee, and the net amount you'll actually be settled on a UPI or card transaction.
Note: Direct bank-to-bank UPI person-to-merchant payments carry zero RBI-mandated MDR. The fee above applies when a payment aggregator/gateway (e.g. for UPI Collect, payment links, subscriptions, or card payments) charges its own service fee — check your gateway's rate card for the exact percentage that applies to you.
MDR — Merchant Discount Rate — is the fee a bank or payment aggregator deducts from a digital transaction before settling the remaining amount to a merchant. Since January 2020, the RBI and NPCI have mandated zero MDR on person-to-merchant UPI transactions routed directly through the UPI network, so a customer scanning a merchant's UPI QR code and paying from any bank app should not have any fee deducted from that payment. In practice, though, most online sellers, marketplaces and subscription businesses accept payments through a payment aggregator or gateway rather than a raw UPI connection, and these platforms are free to charge their own service fee for the convenience — payment links, checkout pages, recurring billing, refunds handling, dashboards and reconciliation tools all cost the aggregator money to run.
This calculator lets you enter any transaction amount and any MDR percentage — your gateway's actual published rate, or a rate you're negotiating — and see exactly how much is deducted before it reaches your account. Because a payment aggregator's fee is a taxable service, GST at 18% applies on top of the MDR itself, which is why the calculator adds that automatically (you can switch it off if you want to see the fee before GST). The result is the same number you'd see on your settlement report: transaction amount minus MDR minus GST on the MDR equals your net payout.
Use it to compare gateways before signing up, to reconcile a settlement report against what you expected, or to work out how much margin a small MDR percentage actually costs you over a month of sales.
Is UPI really free of MDR in India?
For person-to-merchant UPI payments made directly through a bank-linked UPI app, the RBI and NPCI have mandated zero MDR since January 2020. Merchants using a payment aggregator for UPI Collect, payment links or subscriptions may still be charged a service fee by that aggregator, even though the underlying UPI rail itself has no MDR.
What is MDR (Merchant Discount Rate)?
MDR is the fee a merchant pays to a bank or payment aggregator for processing a digital payment, expressed as a percentage of the transaction value, covering payment infrastructure, fraud protection and settlement.
Does GST apply to the MDR charged by a payment gateway?
Yes — a payment aggregator's MDR fee is a taxable service and attracts 18% GST, which is usually deducted along with the MDR before the remaining amount is settled to the merchant.
How is the net settlement amount calculated?
Net settlement = Transaction amount − MDR fee − GST on the MDR fee. For example, on a ₹1,000 payment with a 1% MDR: fee = ₹10, GST on the fee at 18% = ₹1.80, so the merchant receives ₹988.20.