Q1. A merchant receives the following UPI credits in a month:

• ₹1,20,000 through UPI QR into a personal bank account.
• The merchant had exceeded ₹1 lakh of inward UPI credits for the preceding three consecutive months.
• During the month, several individual customer payments exceeded ₹2,000.

Under the framework described in the article, which one of the following is the most appropriate conclusion?

(a) The merchant remains exempt because all UPI QR receipts into a personal account are treated as P2PM transactions.

(b) The merchant is treated under the regular P2M category, and transactions above ₹2,000 can attract the applicable MDR.

(c) The merchant automatically becomes subject to the ₹5 flat MDR applicable to essential services.

(d) The merchant becomes subject to MDR only if individual transactions exceed ₹75,000.

Answer: (b)

Explanation:

• (a) Incorrect: P2PM exemption is subject to the ₹1 lakh/month threshold; exceeding it for three consecutive months results in migration to regular P2M.
• (b) Correct: Once shifted to P2M, the applicable MDR framework for merchant payments applies, including the ₹2,000 threshold.
• (c) Incorrect: The ₹5 flat MDR is specific to specified essential services, not all merchants.
• (d) Incorrect: ₹75,000 is relevant to the MDR cap, not to determining whether MDR becomes applicable.