Voicing concern over the imposition of , the gold jewellery sector has urged the authorities to either exempt high-value transactions in the gold trade from MDR or grant a special exemption to the gold jewellery sector.
S Abdul Nazar, State General Secretary of the Kerala Gold and Silver Merchants Association, pointed out that jewellery establishments are already grappling with several financial obligations, including GST, hallmarking, HUID, banking charges, security expenses and employee-related costs. The addition of MDR, he said, would particularly affect small and medium-sized enterprises.
For instance, an MDR of up to ₹200 would apply to a UPI transaction of ₹50,000, while transactions exceeding ₹75,000 could attract MDR of up to ₹300. Given the thousands of high-value digital transactions conducted in the gold trade every day, the cumulative financial impact of the additional cost cannot be underestimated, he said.
Although a maximum MDR cap of ₹300 has been set for transactions of ₹75,000 and above, the gold jewellery sector predominantly deals in high-value transactions. Consequently, for a jewellery establishment handling numerous UPI payments each day, the cumulative MDR incurred on individual transactions could translate into a significant additional operational expense by the end of the month, Nazar said.
While the government has clarified that MDR should not be collected directly from customers, the financial burden would ultimately be borne by merchants, he added.
Given that UPI has become a cornerstone of India’s digital economy, the gold jewellery trade sector requires special consideration. High-value gold transactions should not be treated on the same footing as routine retail transactions, he added.