Flat ₹5 sectors
Flat ₹5 sectors: fuel, telecom, insurance, railways, utilities - and what is still unconfirmed
Which sectors pay a flat ₹5 UPI MDR instead of 0.4%? The FAQ names railways, telecom, insurance, fuel and utility bills - and an "among others" list not yet published.
Updated: 6 min readहिन्दी
By upicharges.in editorial desk · Published:
The short answer
Which sectors pay a flat ₹5 on UPI?
Railways, telecom, insurance and fuel pay a flat ₹5 on every payment above ₹2,000 instead of 0.4% (FAQ Q33), and so do electricity, water and piped-gas bills (Q41). The ₹300 cap never applies.
The FAQ adds "among others", but the full list has not been published.
In this article
- The confirmed sectors
- Nothing below ₹2,000 here either
- Why the cap does not apply
- Utility bills on AutoPay: nothing at all
- Education: a concession, but not a number
- What "among others" means
- Not sure if you are on the list?
- A separate rate for investments
- Small merchants in these sectors
- Checking your statement
Most merchants pay UPI MDR as a percentage: 0.4% of the full amount on payments above ₹2,000, capped at ₹300. A handful of sectors pay something different - a flat ₹5 per payment above ₹2,000, however large the payment is. For a petrol pump, an insurer or an electricity board, that is a very different bill.
This article lists the sectors the FAQ confirms, shows how the flat fee works at different amounts, explains why the ₹300 cap never comes into it, and is plain about the part of the list that is still missing. Every rule carries its FAQ question number so you can check it in the official document.
The confirmed sectors
The FAQ names these directly:
- Railways, telecom, insurance and fuel - a flat MDR of ₹5 per payment above ₹2,000 FAQ question FAQ Q33.
- Insurance premiums - confirmed again in their own answer: premium payments above ₹2,000 pay a flat ₹5, not a percentage FAQ question FAQ Q39.
- Fuel at petrol pumps - confirmed again: ₹5 on payments over ₹2,000, and 0% on fuel payments under ₹2,000 FAQ question FAQ Q40.
- Utility bills - electricity distribution, municipal water charges and piped natural gas fall into a designated "Industry program" category, with a flat ₹5 on bills above ₹2,000 instead of 0.4% FAQ question FAQ Q41.
The FAQ gives its reason in plain terms: a flat fee stops costs escalating in critical public services, utility bill collection and thin-margin sectors like fuel retail FAQ question FAQ Q33.
Nothing below ₹2,000 here either
The ₹2,000 threshold works exactly as it does everywhere else. A payment of ₹2,000 or less costs nothing, even in a flat-fee sector FAQ question FAQ Q33, Q40.
And a payment of exactly ₹2,000 is still free, because the fee applies to payments above ₹2,000 FAQ question FAQ Q33.
Why the cap does not apply
The ₹300 cap exists to stop 0.4% growing without limit on large payments FAQ question FAQ Q32. A flat fee does not grow at all, so there is nothing for the cap to do.
| Payment | MDR | You receive |
|---|---|---|
| ₹1,500 | ₹0 | ₹1,500 |
| ₹2,000 | ₹0 | ₹2,000 |
| ₹2,500 | ₹5 | ₹2,495 |
| ₹10,000 | ₹5 | ₹9,995 |
| ₹50,000 | ₹5 | ₹49,995 |
| ₹80,000 | ₹5 | ₹79,995 |
| ₹2,00,000 | ₹5 | ₹1,99,995 |
Every row above ₹2,000 is ₹5. An ₹80,000 fuel payment for a fleet costs ₹5; the same payment at a general shop would cost ₹300.
Utility bills on AutoPay: nothing at all
There is one further step for bills. If a customer pays through a UPI AutoPay mandate - a standing instruction that pays the bill each month - there is no prescribed MDR on it at all, whatever the amount FAQ question FAQ Q22. So the same ₹3,200 electricity bill costs the company ₹5 if the customer pays it by scanning or entering a UPI ID, and nothing if it comes through AutoPay. More on mandates: Why AutoPay and SIP payments carry no UPI MDR.
Education: a concession, but not a number
Section 6 of the FAQ also covers educational fees - school tuition, university term fees and entrance examinations - as a designated "Industry program" category. It says payments up to ₹2,000 stay free, and that payments above ₹2,000 benefit from "flat-fee structures or capped processing rates" FAQ question FAQ Q42.
What "among others" means
After naming railways, telecom, insurance and fuel, the FAQ says "among others" FAQ question FAQ Q33. That tells us the list is longer than the sectors it names - but not what else is on it.
It is also worth being clear about what the flat fee is not. It is not a general discount for "essential" businesses. A kirana, a pharmacy or a restaurant is not on the list unless it is officially notified, and pays the standard 0.4% above ₹2,000 like any other P2M merchant FAQ question FAQ Q26.
Not sure if you are on the list?
Our MDR calculator has an option for exactly this: "My sector may be on the flat-fee list but I am not sure". Choose it, and the calculator works out your fee at the standard 0.4% - the rule that applies unless your sector is notified - and shows alongside it what you would pay if your sector turns out to be on the flat ₹5 list.
A separate rate for investments
Payments to mutual funds, stockbrokers, securities dealers and investment platforms are not a flat ₹5 sector. They have their own rate: 0.02% of the amount, capped at ₹300 FAQ question FAQ Q37, Q38. Our calculator does not model this rate. If you are in that business, confirm the figure with your PSP.
Small merchants in these sectors
Being in a flat-fee sector does not override the small-merchant exemption. A small vendor who takes up to ₹1 lakh a month over QR straight into a personal account is P2PM and pays nothing, whatever their business FAQ question FAQ Q23, Q24. The check: Does the new UPI MDR apply to my shop? A step-by-step check.
Checking your statement
If you are in a flat-fee sector, your settlement report should show ₹5 on every payment above ₹2,000 and nothing on the rest, from 15 October 2026 FAQ question FAQ Q5. A percentage fee on a fuel or insurance payment is a sign your account may be categorised under the general rate - raise it with your PSP. Our settlement check lets you pick your sector and recalculates every row; How to read your UPI settlement statement and spot a wrong deduction explains how to read the report by eye.
For how the cap works for everyone else, see How the ₹300 UPI MDR cap works, with examples at ₹5,000, ₹50,000 and ₹1 lakh. The whole picture of the new rules is in UPI charges from 15 October 2026: the complete guide for merchants.
Common questions
Which sectors pay a flat ₹5 UPI MDR?
Railways, telecom, insurance and fuel (FAQ Q33, Q39, Q40), and electricity, water and piped-gas bills (FAQ Q41). The FAQ adds "among others", but the full list has not been published.
Is there MDR on a ₹1,500 fuel payment?
No. Payments of ₹2,000 or less carry no MDR, including at petrol pumps (FAQ Q40).
Does the ₹300 cap apply to flat ₹5 sectors?
It never needs to. The fee is a fixed ₹5 on any payment above ₹2,000, however large (FAQ Q33).
Do school fees pay a flat ₹5?
Not confirmed. The FAQ says education gets flat-fee structures or capped rates above ₹2,000 but does not give the figure (FAQ Q42).
Everything in one place: the complete guide to UPI charges →
upicharges.in editorial desk — Checks every article against the NPCI/DFS FAQ of 15 September 2026
Every fact in this article comes from the NPCI/DFS FAQ of 15 September 2026. Read the official NPCI/DFS FAQ