Train ticket booking rules changing from October 15; ₹5 charge applicable on payments above ₹2,000
A new Merchant Discount Rate (MDR) rule will come into effect on October 15, 2026, for train tickets booked via UPI exceeding ₹2,000. Find out if this will make tickets more expensive and how it will impact your pocket.
If you frequently book train tickets online and use UPI (such as PhonePe, Google Pay, or Paytm) for payment, here is some very useful information for you. A new rule regarding the Merchant Discount Rate (MDR) is set to apply to rail ticket payments exceeding ₹2,000 starting October 15, 2026.
However, there is absolutely no need to worry; this change will not place even a single rupee of extra financial burden on you. Let us understand the details of the matter.
What is the new rule, and when does it come into effect?
From October 15, 2026, a flat MDR of ₹5 will apply to rail tickets booked via UPI that cost more than ₹2,000.
While a charge of 0.4% has been set for amounts exceeding ₹2,000 in general merchant transactions (such as at shops or for other services), specific sectors like railways, telecom, insurance, and fuel have been placed in a special category. Therefore, whether the ticket costs ₹3,000 or ₹10,000, a fixed charge of only ₹5 will apply to the railway transaction.
Transaction Type Amount New MDR Rule| Regular UPI Transfer (P2P) | Any Amount | Completely Free |
| Small Merchant Payment | Up to ₹2,000 | Completely Free (No MDR) |
| Regular Merchant Payment | Above ₹2,000 | 0.4% (Maximum ₹300) |
| Railway Ticket Booking | Above ₹2,000 | ₹5 (Flat Fee) |
Will passengers have to pay more for tickets?
No, the Ministry of Finance has clarified that this ₹5 MDR will be borne by the merchant (i.e., the Railways/IRCTC).
No extra charge: Under no circumstances can banks or merchants recover this fee from passengers. Here is an example: If you book a ticket worth ₹3,000, you will pay exactly ₹3,000, not ₹3,005.
The math behind the significant savings: If the 0.4% rule applied to the Railways, the MDR on a ₹10,000 ticket would amount to ₹40. However, due to its classification under a special category, the charge on the merchant side will be only ₹5.