MUMBAI: The introduction of merchant fees on UPI transactions could help expand its use in cross-border payments by giving merchants an alternative that remains cheaper than cards and cash, said Max Neukirchen, co-head of JP Morgan Global Payments.Neukirchen said the cross-border use case for UPI could benefit from the introduction of a merchant discount rate (MDR) on person-to-merchant payments as this incentivises intermediaries. “Fast-payment systems such as UPI started as domestic solutions. They now exist in dozens of countries, including all the major economies. The next big step is cross-border faster payments,” he said.While acknowledging that charging fees on UPI is a “thorny topic”, Neukirchen said the proposed charges would remain competitive. “Where the 40-basis-point charge applies, it is still cheaper than most alternatives. Card payments cost more. Even cash has higher costs because businesses need to hold cash and face the risk associated with it,” he said.Neukirchen said the integration of domestic fast-payment networks with global payment infrastructure would be a key trend. JP Morgan has connected Indian payment systems, including IMPS and UPI, with its global infrastructure to facilitate movement of payments and money into and out of India.“Payments are a key way to facilitate that growth. We have connected Indian payment schemes and the ecosystem, including IMPS and UPI, with global infrastructure to make it easier for clients to move payments and money in and out of the country,” he said.He said there was growing interest among multinational companies in conducting treasury operations from GIFT City. JP Morgan has more than 100 multinational clients there and is expanding its offerings beyond trade finance and foreign exchange to payments, including connectivity to deposit accounts and clearing.“Payments are a key way to facilitate that growth,” Neukirchen said, adding that the bank was focused on leveraging India’s payments innovation, particularly UPI, to facilitate cross-border money movement.He said trade finance was another priority as global supply chains are being reshaped by macroeconomic changes.