You know Pine Labs by name, but let me tell you that it is a fintech company that offers payment solutions. The company's business is divided into two parts: digital infrastructure and transaction and issuing, as well as acquiring platform management. The company is in the hands of professional management, there are no promoters. Besides India, the company also operates in countries like Malaysia, UAE, and Australia. And the entire development that has happened today regarding MDR, the company does related work. We are going to meet the company's CEO, Amrish Rau, who is joining us in the program. Sir obtained a bachelor's degree in engineering from Mumbai University in 1996. Sir has a long and deep experience in the payment and fintech industry. He also has experience working with institutions like PayU India, First Data, and NCR Corporation. Since 2020, you have been associated with Pine Labs Singapore, and then from March 2025, with Pine Labs in India. Sir, good morning. A very warm welcome to you. Thank you for giving us your time. First of all, please explain, sir, the new framework regarding MDR charges that came from the government yesterday, which will be implemented from October 15th. How do you see this for the industry? What are its implications, and what changes will it bring for companies and for the common consumer? Please explain.
Anil ji, thank you very much for inviting me to your show.
Thank you, sir. Sir, let me give you one, two, three numbers. About three years ago, UPI growth was at 60%. Two years ago, it became 38%, and last year, this growth fell below 30%, to about 28%. Second, UPI, which is fast payments, fast payments in India, about 35% of retail payments is now covered under UPI payments today. If you look at this, in Brazil, the number is currently at 90%. In China, this number is 80 to 90%. Now, one of the reasons why this is not growing fast enough is for us to go and invest in new ideas, new businesses, new markets, small pockets of the country. It requires a lot of investments to happen. Honestly, through this new MDR regime which has come through, it will allow us to invest in people, technology, and go into those areas. Before 2020-2021, MDR was always present on UPI. UPI was growing extremely fast. I personally think with what has happened over the last few days, we will be allowed to invest into new technologies and new people and go into these newer sectors. So it's all a very good change which has happened.
Okay. So the biggest thing is that companies will get help in expanding UPI infrastructure. Now, the big changes that have happened, person-to-person payments have been kept without any charges. Are companies in agreement with this, or should there have been charges on that too?
No, sir. What happens in this is, if you give any friction to the consumer that even in person-to-person, if charges are applied on UPI, then they will stop using it. Where you want to make that payment, if you apply a small fee, say 0.4%, the consumer is not troubled by it because the consumer doesn't make any payment on it. But the merchant, who has to pay that 0.4% MDR on transactions above ₹2000, they should be happy to accept it at one point. And I have heard you talk a lot about technology and Infosys, Wipro, they have done very good work for 20 years in taking Indian technology global. Today, if there is one technology that we have built in India which we can export out, it is actually fintech. You know, we talk about the fact that UPI, if you go to France, you will find UPI, if you go to Singapore, you will find UPI, but less than 3% of places in Singapore and France will you find UPI transactions. With the geopolitics that is going on, it is imperative that India's UPI infrastructure actually goes global. So if an Indian consumer goes to Paris tomorrow, he should be able to use a UPI transaction. It is very, very important for the country. What I am simply saying is, Indian fintech can be exported globally. It can create a new, new opportunity for the Indian technology industry, and that is what we at Pine Labs are really trying to capture.
That's right. Now tell me, sir, the 0.4% charges have been decided, and a maximum of ₹300 for transactions above ₹75,000. Plus, for stock market-related transactions, there is also a cap of ₹300. For fuel, there is a cap of ₹5, for tickets, electricity bills. What do you think was the industry's demand, and as a company, as an industry, do you think this is reasonable, or should it have been a bit more, or less?
Sir, balance is very important in this. If you make these charges so high that merchants don't like them, they will stop using them. They will tell consumers, 'No, you give cash.' 0.4%, according to me, is the perfect number where neither the merchants are impacted by it, and at the same time, they are not going to be influencing the consumer. Now, at the same time, by capping it at ₹300, another masterstroke has been played. By capping it at ₹300 also, high-value transactions also will not become too expensive for the Indian merchants. So I am very comfortable where the, you know, the whole MDR charges have come out at today.
