DPI Brief — August 07, 2026
1. Parliament Passes Bill Amending Payment and Settlement Systems Act — UPI MDR Legal Framework Created (L2: Payments)
The Lok Sabha on August 6 passed the Taxation and Other Laws (Amendment) Bill, 2026, which amends Section 10A of the Payment and Settlement Systems Act, 2007. The amendment removes the legal provision that prevented banks and payment service providers from charging a Merchant Discount Rate (MDR) on UPI transactions, creating the legal authority for the government to notify MDR charges in the future.
Finance Minister Nirmala Sitharaman clarified that any MDR would apply to merchants, not end-users. The actual MDR framework will be decided by the NPCI-led UPI Services Steering Committee only after the Bill receives full parliamentary enactment. The move comes amid sustained criticism from the U.S. Trade Representative’s 2026 National Trade Estimate Report, which targeted India’s zero-MDR regime, RuPay support, and data localisation requirements.
The timing is notable: UPI processed 23.6 billion transactions worth ₹29.9 trillion in July 2026 alone. GTRI has urged India to resist U.S. pressure and maintain policy autonomy over its payment infrastructure. NPCI’s proposed 30% market-share cap for individual payment apps (deferred to December 2026) remains a related flashpoint, with Google Pay and PhonePe together processing over 80% of UPI transactions.
Sources: The Hindu, The New Indian Express, South Asian Herald
2. Data Protection Board Remains Unstaffed Eight Months After Rules Notified (L7: Trust)
A LiveLaw analysis highlights that the Data Protection Board of India — the adjudicatory body established under the Digital Personal Data Protection Act, 2023 — remains without a Chairperson or members nearly eight months after the DPDP Rules, 2025 were notified on November 13, 2025. The rules set up a two-track selection process involving committees chaired by the Cabinet Secretary and the MeitY Secretary, but no appointments have been made.
This means India’s data protection framework has a statute, rules, and a designated body in law — but no functioning regulator in practice. The DPDP Act received Presidential assent in August 2023, and certain provisions became enforceable from November 14, 2025. The absence of a functioning Board leaves citizens without an operational avenue for adjudicating data protection complaints.
Separately, the DPDP Act’s intersection with AI training continues to generate debate. NASSCOM has examined the growing conflict between personal data rights and AI training data practices, particularly around Significant Data Fiduciary obligations for automated decision-making systems.
3. Over 5.6 Lakh Cyber Fraud Complaints from Women and Senior Citizens in 2025 (L7: Trust)
The Ministry of Home Affairs informed the Rajya Sabha that over 1.03 lakh senior citizens and 4.63 lakh women reported financial cyber fraud losses totalling ₹7,769.63 crore in 2025, citing National Crime Records Portal (NCRP) data. CERT-In handled over 29.44 lakh cyber incidents in 2025, issuing 1,530 alerts and 390 vulnerability notes.
The scale of digital payment fraud is growing in tandem with UPI’s expansion. RBI’s Annual Report for 2024-25 recorded 13,516 digital payment fraud cases, with 56.5% linked to UPI transactions. The RBI’s MuleHunter.AI initiative and proposed .bank.in domain are among the verification infrastructure responses being developed. AI-driven phishing in regional languages is an emerging threat vector, with first-time digital users particularly vulnerable.
Sources: Economic Times, ORF
4. ONDC TEAMS Scheme Targets 5 Lakh MSME Onboarding, 50% Women Entrepreneurs (L4: Commerce)
The Ministry of MSME is actively promoting the Trade Enablement and Marketing (TEAMS) Scheme, which aims to onboard 5 lakh MSMEs onto the Open Network for Digital Commerce (ONDC), with 50% participation targeted for women entrepreneurs. The scheme simplifies onboarding for small businesses looking to sell through the open e-commerce network.
The announcement aligns with broader government efforts to expand PMEGP, PM Vishwakarma, and ONDC support for rural MSMEs. The cooperative-led Bharat Taxi platform — India’s first cooperative ride-hailing initiative announced by Amit Shah — is being linked with DigiLocker, UMANG, and API Setu for seamless verification, demonstrating cross-layer DPI integration between L3 (Documents) and L4 (Commerce).
Sources: Ministry of MSME, SMEStreet
5. NeGD AI Capacity-Building and Digital Governance Training (L6: Governance)
The National e-Governance Division (NeGD) conducted a three-day AI capacity-building workshop for Indian Railway Accounts Service officers, and virtual training on the e-Office system continues across government departments. The DARPG released an eBook on its two-year achievements, launching a Good Governance initiative.
In Meghalaya, a two-day training programme on the Meghalaya One Digital Platform was held for Drawing and Disbursing Officers of East Jaintia Hills, advancing paperless administration at the state level. These capacity-building efforts reflect the ongoing institutional push to digitise governance workflows across central and state governments.
Sources: Digital India (Facebook), DIPR Meghalaya