Indian Railways UPI ticket booking: Will you pay ₹5 extra for tickets above ₹2,000?

If you book train tickets through UPI, a new payment rule coming into effect from October 15, 2026, may raise one obvious question: Will you have to pay an extra ₹5 when your railway ticket costs more than ₹2,000?

The answer is no. The ₹5 charge will apply on the merchant side and is not supposed to be added to the passenger's railway ticket fare.

Under the new UPI framework, transactions above ₹2,000 made to regular merchants will attract a 0.4 per cent Merchant Discount Rate (MDR). Railway ticketing, however, has been placed in a separate category where the MDR will be capped at a flat ₹5 per transaction.

What does this mean when booking a train ticket?

For passengers, the ticket fare should remain unchanged.

So, if your railway ticket costs ₹3,000 and you pay through UPI, you should not be charged ₹3,005 simply because of the new MDR rule. The ₹5 payment-processing charge is meant to be borne by the merchant side.

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The same applies to higher-value bookings. A ₹5,000 railway ticket would attract a ₹5 MDR on the merchant side. Under the standard 0.4 per cent rate applicable to regular merchants, the charge on a ₹5,000 transaction would otherwise work out to ₹20.

For a ₹10,000 railway ticket, the MDR would still be ₹5 rather than ₹40, which would be the charge at 0.4 per cent for a regular merchant transaction.

What changes from October 15?

The new structure keeps UPI transactions of up to ₹2,000 outside the MDR. For transactions above that amount, regular merchants will face a 0.4 per cent MDR, while railway ticketing gets the special flat ₹5 rate.

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The Union Finance Ministry has advised banks that the MDR should not be passed on to customers.

The change also does not mean that Indian Railways ticket fares will automatically increase. A passenger booking a ₹3,000 ticket through UPI should continue to pay ₹3,000, rather than an additional ₹5 because of the MDR.

The new rule applies to merchant payments. Person-to-person UPI transfers will remain free regardless of the amount.