MCX, Groww, BSE, CDSL, among others drag Nifty Capital Market index down 2%; key triggers

Capital market stocks like BSE, MCX, Billionbrains Garage Ventures (Groww), Nippon Life India AMC, and CDSL, among others, dragged down the sectoral benchmark index by more than 2% during the trading session on Wednesday, September 16.

Investors were reacting based on several key triggers, including the overall weak sentiment in the equity market, the new National Payments Corporation of India (NPCI) guidelines which impact mutual funds, stock brokerages, dealers, and the latest remarks from the NSE CEO on the short term impact of UPI transaction volumes.

NSE data showed that the sectoral benchmark, Nifty Capital Market index, lost 2.1% to touch an intraday low of 5,142.95 points on Wednesday’s market, in comparison to 5,255.60 points at the previous equity market close.

After declining to the intraday lows, the index recovered some of its losses, trading 1.36% lower during the morning market hours on NSE at around 5,184.20 points, as per the exchange data.

Stocks like Groww, Nippon Life India, UTI AMC, Aditya Birla Sun Life, and MCX were leading the pack of laggards on Wednesday’s market.

While market experts believe that the new NPCI norms will benefit the UPI payment platforms, merchant companies and brokerages are expected to record an increase in their fee payment to these aggregators effective from October 15, 2026.

"Positive for ecosystem economics, with issuer banks emerging as key beneficiaries," said analysts from global investment firm JP Morgan.

Capital market stocks in focus today

Why are capital market stocks falling today?

Capital market stocks witnessed a decline in Wednesday’s market as investors reacted to the latest UPI Merchant Discount Rate (MDR) charges imposed on merchants amid capital rotation towards defensive stocks and an overall weak sentiment among broader indices due to higher energy costs.

As per the official NPCI circular, UPI payments which involves mutual funds, securities, stockbrokers and dealers will attract an MDR fee of 0.02%, capped at a maximum of ₹300 per transaction.

NSE CEO said that the new MDR charges are expected to weigh on transaction volumes in the short term, but activity is expected to normalise over time.

“There may be some impact initially on our transaction volumes in the short term due to the MDR charges above Rs 2,000. After some time, I hope it normalises,” said Ashishkumar Chauhan, the MD and CEO of National Stock Exchange (NSE).

With UPI being a major source of payment from customers, any fall in transaction volumes is likely to impact these capital market companies if customers decide to carry out fewer transactions.

Above the threshold of ₹2,000 per transaction, capital market companies like mutual funds and brokerages will have to pay 0.02% or a maximum of ₹300 per transaction fee to the UPI payment aggregators, in turn increasing their overall expenses.

The MDR charge will be paid by the merchants, while customers who pay these merchants will not be charged any fees under this new initiative.

So far, no updates have been shared on whether or not this UPI MDR charge will be passed on to the customers.

However, the banks have been advised by the government to ensure that the merchants do not pass on the MDR to customers, while UPI application service providers have been prohibited from imposing platform fees or hidden charges on UPI transactions.