However, as the 32nd report of the Standing Committee on Finance noted, “the absence of MDR makes the UPI ecosystem financially unsustainable”. Ensuring the smooth running of the payments ecosystem — in July, 23.6 billion transactions were processed through the UPI platform — entails huge costs. Between 2021-22 and 2024-25, the Union government reportedly handed out Rs 8,730 crore under an incentive scheme for subsidising payments. Person-to-merchant (P2M) transactions accounted for 63 per cent of all transaction volumes, but only 29 per cent of value in the first half of 2025. In 2025-26, only 4 per cent of P2M transactions were above Rs 2,000, and these accounted for two-thirds of P2M value.