Payments body seeks MDR return; Turkey opposition X-ed out

The Payments Council of India has sought the return of a merchant discount rate (MDR) for large merchants. This and more in today’s ETtech Top 5.

Also in the letter:
■ Klarna IPO opens doors for fintechs
■ Ant’s AI breakthrough
■ Kunal Kamra vs Bhavish Aggarwal

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The Payments Council of India (PCI), the industry body for payment companies, has written to the Prime Minister’s Office (PMO) requesting the reintroduction of the merchant discount rate (MDR) on payments processed via Unified Payments Interface and RuPay debit cards.

Driving the news: In a letter to the Prime Minister, the digital payments industry has called for MDR to be reinstated for large merchants. PCI has also sought a meeting with the Prime Minister to present its case.

Also Read: UPI incentive of Rs 1,500 crore 'insufficient' to sustain digital payment ecosystem: PCI

Getting the context: On March 21, the government issued a gazette notification announcing a Rs 1,500 crore subsidy for banks to support UPI payments on small merchants. However, the industry had anticipated a subsidy of Rs 5,500 crore for the current fiscal year, raising concerns over the financial sustainability of the digital payments industry.

Also Read: To ease financial squeeze, fintechs mull seeking MDR restoration or higher subsidy

Go deeper: The government had previously moved UPI and RuPay debit card transactions to a zero MDR regime to accelerate digital payments adoption. While UPI has witnessed exponential growth, industry insiders have told us that the adoption of RuPay debit cards has stagnated. In the letter, the PCI stated that the payments ecosystem incurs an annual cost of approximately Rs 10,000 crore to sustain digital transactions.

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Elon Musk's social media platform X has suspended multiple opposition accounts in Turkey amid the ongoing civil unrest.

What’s happening:

• Protests erupted across Turkey following the arrest of Ekrem İmamoğlu, the mayor of Istanbul and a key opposition figure, despite the government’s four-day ban on public gatherings.
• According to Yusuf Can, an analyst at the Wilson Center's Middle East Program, most of the suspended accounts belonged to "grassroots activists". These accounts, with small followings, were sharing protest locations, particularly near universities, where students were mobilising.

In response, the Turkish government sought the suspension of certain accounts, citing a 2022 law that grants authorities broad powers to suppress online content.

Musk, who frequently claims to be a "free speech absolutist," now faces criticism for allowing these suspensions, raising questions about his commitment to free expression.

Also Read: Elon Musk's X sues union government over alleged censorship and IT Act violations

Contradictory case: In August 2024, Musk refused to remove accounts that Brazilian Supreme Court judge Alexandre de Morae claimed threatened the country’s democracy. As a result, X was blocked in Brazil.

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Swedish giant Klarna’s upcoming US listing could help pave the way for British fintech IPOs following a sluggish period for new tech listings from the country, experts said.

On the bourses: Stockholm-headquartered Klarna, known for its buy-now-pay-later (BNPL) products, filed papers to go public on the New York Stock Exchange this month, marking its second IPO attempt in four years.

The company saw a valuation surge from $5.5 billion to $45.6 billion across three funding rounds and planned an IPO in 2021. However, rising interest rates and a broader macroeconomic slowdown shifted investor investment, leading the company to reduce its valuation to $6.7 billion in a 2022 funding round.

Waiting in the wings: UK-based banks Monzo and Starling and payments companies Zilch and Ebury are considering plans to list soon.

“The Klarna IPO will be a significant moment for the fintech sector and could set the stage for greater investor confidence in European fintechs going public,” Philip Belamant, CEO of Zilch, told Reuters.

Back home: On March 20, we reported that investment activity in India’s fintech sector is picking up, with growth-stage deals already attracting over $550 million of capital in 2025, according to Venture Intelligence data. For context, 2023 and 2024 saw $1.3 billion each in fintech investment.

Also Read: Stock broking startup Groww in talks for IPO valuing it at $6-8 billion: sources

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Ant, backed by Jack Ma, utilised Chinese-made semiconductors to create methods for training AI models, potentially cutting costs by 20%.

Tell me more:

• The company used domestic chips from Alibaba and Huawei Technologies to train models using the Mixture of Experts machine-learning approach.
• Sources told Bloomberg that the results are comparable to those achieved with Nvidia's H800 chips, which are currently barred from China.
• While Ant still uses Nvidia for some AI development, it now primarily relies on alternatives such as Advanced Micro Devices (AMD) and Chinese-made chips for its latest models.

AI race: The move places Ant in direct competition with Chinese and US tech firms following startup DeepSeek’s recent demonstration that AI models can be trained for a fraction of the cost of OpenAI and Google's multi-billion-dollar investments.

Also Read: DeepSeek's disruption triggers AI race in China as Baidu, Tencent, Alibaba ramp up efforts



Mumbai-based AI firm Fractal Analytics has proposed building India’s first large reasoning model (LRM), seeking government funding to support the initiative.

Proposal details:

• Fractal plans to build the LRM at a total project cost of Rs 118.8 crore and is seeking Rs 76.6 crore in external funding.
• Fractal’s planned model surpasses OpenAI’s o1 and o3 reasoning models. In comparison, the largest global reasoning model, DeepSeek R1, has 671 billion parameters.

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Standup comedian Kunal Kamra reignited his feud with Ola Electric founder Bhavish Aggarwal during his controversial show in Mumbai.

What’s the news: Commenting on the recent fires involving Ola scooters, Kamra said Indian businessmen often refuse to admit their mistakes. “Take the Ola guy, for example. What did I say that made him so angry? You manufacture two-wheelers, and neither of the wheels works,” he said.

‘Focus on refunds’: Instead of offering him money, Kamra urged Aggarwal to provide it to customers waiting for refunds on their Ola’s e-bikes. Aggarwal had invited the comedian to assist at Ola’s service centres, promising better pay “than his flop shows”.

Source: Google

Also Read: Explained: Why Ola Electric's sales numbers do not hold up