UPI’s MDR Era, SEMICON India Day 1 Highlights & More

Who Will Foot The UPI MDR Bill?

UPI transformed digital payments by making them virtually free. From October 15, this equation will change as high-value transactions will begin attracting MDR. While the new regime opens a new revenue pool for fintechs, it could reshape user behaviour. So, who will now bear the cost?

UPI Ends Free Ride: The new framework imposes a 0.4% MDR on P2M UPI payments above ₹2,000, capped at ₹300 for transactions of ₹75,000 and more. Merchants receiving up to ₹1 Lakh a month via QR codes remain exempt, but sellers crossing the threshold repeatedly will enter the MDR category. This could expose small businesses to payment acceptance costs, particularly during the festive season when higher-value transactions are the norm.

The Merchant-Side Test: For many sellers, the financial effect will depend on ticket size and transaction mix. A business selling low-value goods may see little immediate impact, while retailers and D2C brands could face a meaningful recurring cost. More importantly, merchants will now have to weigh MDR alongside gateway fees, logistics and marketplace commissions when calculating margins.

The Convenience Question: While the government has prohibited merchants from passing on the costs to consumers, the order does not guarantee that the cost will disappear. Businesses, under margin pressure, may absorb MDR through broad price increases rather than displaying a separate payment fee at checkout. On top of this, many fear that higher-value buyers could move back to cash if UPI loses its frictionless appeal. 

Sustainability Vs Scale: Nevertheless, fintech startups see MDR as essential for funding technology upgrades and wider payment infrastructure without relying on subsidies. The revenue could also make UPI more viable for smaller payment players competing against dominant apps. But the success of the policy will rest on maintaining a delicate balance between protecting small merchants and ensuring costs are not pushed onto consumers. 

So, can UPI finally become financially viable without losing the low-cost advantage that made it indispensable? Let’s find out…

From The Editor’s Desk

SEMICON India 2026 Day 1

• PM Narendra Modi yesterday inaugurated the fifth edition of SEMICON India 2026 event in New Delhi, setting the stage for three days of semiconductor dealmaking, technology showcases and ecosystem building. 
• The event opened with a flurry of investment commitments, led by Applied Materials’ plans to invest $5 Bn in India by 2035. IT minister Ashwini Vaishnaw also said that Semicon 2.0 has received ₹1 Lakh Cr worth of investment commitments.
• This comes as India enters its latest phase of its chip ambitions. The recently launched Semicon 2.0, with an outlay of ₹1.28 Lakh Cr, aims to build capabilities across chip design, equipment, materials, advanced packaging, R&D and talent.

DealShare’s House Of Cards

• Once valued at $1.7 Bn, the ecommerce unicorn has now dissolved into a distressed asset. DealShare is now seeking a buyer at a 95% haircut amid shrinking operations and multiple failed pivots. 
• DealShare’s unraveling follows years of unsustainable customer acquisition spending and shifting operating models. High fulfillment expenses, low margins and mounting losses have forced the startup to shut down both B2B and B2C operations since 2023.
• Amid the operational churn, the startup’s online business is now near zero, store expansion has paused and the new leadership brought in to steer the startup is itself changing. 

RentoMojo’s Bumper Listing

• Shares of the furniture and appliance rental startup made a strong debut on the bourses. The stock listed at ₹482.45 on the NSE, a premium of 19.4% over its issue price of ₹404. On the BSE, RentoMojo opened at ₹480, up 18.81% from the issue price.
• The strong listing followed robust demand for RentoMojo’s ₹1,256 Cr IPO, which closed with an overall subscription of 72.88X. The public issue comprised a fresh issue worth ₹150 Cr and an OFS component of up to 2.74 Cr shares worth ₹1,106 Cr.
• Founded in 2014, RentoMojo operates a platform that rents furniture, appliances and other household products. As of March 2026, it had about 2.5 Lakh live subscribers and 8.5 Lakh live items across its furniture and appliance portfolio.

Aakash Trims FY26 Losses

• The coaching chain managed to narrow its net loss by nearly 16% to ₹186.5 Cr in FY26 from ₹220.8 Cr loss in the previous fiscal. The improvement in the bottom line came despite operating revenue rising marginally by 0.4% YoY to ₹2,040.5 Cr.
• The real swing factor came as non-operating income more than doubled YoY to ₹113.7 Cr in the fiscal under review. This was driven largely by a ₹76.1 Cr write-back of provisions or liabilities alongside a ₹19.7 Cr gain from remeasurement of lease liabilities.
• Meanwhile, total expenses remained largely flat, up barely 1% YoY to ₹2,397.8 Cr in FY26. As a result, loss before exceptional items and tax narrowed nearly 17% YoY to ₹243.5 Cr in the fiscal under review.

DheyaTech Bags ₹43 Cr

• The aerospace propulsion startup has raised $5 Mn in a round led by Avaana Capital to scale production, establish a testing facility for its gas turbine engines, and accelerate commercial deployments. It is targeting flight trials of its engines in Q4 2026. 
• Founded in 2018, DheyaTech develops indigenous small gas turbine engines for aerial platforms and energy systems. It is also expanding into hydrogen-based technologies and distributed power-generation systems. 
• The fundraise comes amid growing investor interest in deeptech startups developing indigenous hardware and propulsion technologies. As per Inc42 data, advanced hardware and technology startups raised $365 Mn across 66 deals in H1 2026.

Bombay Shaving Company Vs Gillette

• In line with Delhi HC’s directions, the men’s grooming brand has revised its Switch4 ad campaign. This comes a day after the court directed the brand to remove the ad, which is at the centre of its ongoing product disparagement dispute with Gillette India. 
• BSC’s Switch4 campaign pitched its four-blade razor as an upgrade to a three-blade cartridge. Gillette alleged that the ad disparaged its products, while the brand argued that it was a comparative advertising campaign and did not explicitly name Gillette.
• Gillette has also objected to a fresh BSC commercial, with its counsel calling the new ad obscene and seeking intervention. The court declined to pass an order on the new commercial, saying the issue could be considered if it is formally challenged. 

Inc42 Markets

Inc42 Startup Spotlight

Can Swapp Design Turn EV Charging Into A Pit Stop?

For commercial EV fleets, every hour spent charging means lost deliveries and lower asset utilisation. Meanwhile, large batteries inflate upfront vehicle costs. Swapp Design is tackling these problems by using robots and modular packs to get cargo back on the road in minutes.

Swapping With Robots: Founded in 2022, Swapp Design is building an autonomous battery swapping network for electric four-wheelers. Its SwappBot robots slide beneath a parked vehicle, locate and remove depleted battery modules, and replace them with charged ones. The startup claims that this process can be completed in under a minute.

A Modular Ecosystem: The startup is also developing interoperable battery packs, a proprietary battery-management system and software that monitors battery health, usage and optimisation. It charges fleet operators on a per-kilometre basis, reducing acquisition costs and degradation risk.

The Frugal Approach: Rather than relying on expensive mega-stations, Swapp Design’s approach is built around frugal robotics. The startup claims that this approach reduces station costs from roughly ₹4 Cr to about ₹15 Lakh, while supporting modular throughput of six to 48 EVs per hour.

With India’s battery-swapping market projected to become a $517.9 Mn opportunity by 2034, can Swapp make battery swapping affordable and reliable for commercial EVs?

Infographic Of The Day

From daily subscriptions paid by drivers to advertising, Rapido has built multiple ways to monetise its growing network. Here is how the ride-hailing giant actually earns money…

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