Bernstein Research

India proposes merchant fees for UPI payments

India has introduced legislation to create a legal framework that could allow merchants to be charged on some Unified Payments Interface (UPI) transactions, potentially ending the zero-merchant-discount-rate (MDR) regime that has kept merchant UPI acceptance free since January 2020. The bill does not itself set fees or define which transactions would be charged; those details would be decided later. UPI processed a record 23.66 billion transactions worth ₹29.88 trillion in July 2026, according to the National Payments Corporation of India (NPCI). Analysts and brokerages (Jefferies, Bernstein) say targeted merchant charges on higher-value transactions could create a meaningful new revenue stream for banks, payment apps and fintech firms while preserving free consumer and peer-to-peer payments.

SpaceX’s Post‑IPO Plunge Ahead of First Earnings

Investors are watching SpaceX ahead of its first quarterly report after the June 12 IPO, following a collapse that wiped out more than $500 billion of market value and left the stock over 50% below its intraday high. The company — with an implied market cap near $1.4 trillion — faces scrutiny over valuation and fundamentals: a price‑to‑sales ratio in the 70s, negative free cash flow, multibillion-dollar quarterly cash burn and debt roughly double cash. Strategic catalysts could justify the price if successful: making Starship reusable, expanding profitable Starlink connectivity while launches remain loss-making, building orbital and terrestrial data centers, and growing AI compute and products (Grok). Key commercial moves include large compute contracts with Google and Anthropic and a planned ~$60 billion acquisition of AI coding startup Cursor; short sellers have also posted sizable paper gains since the IPO.

Warnings of an AI Bubble and Potential Crash

Multiple financial commentators and analysts warn that the rapid rise of AI may constitute an unprecedented financial bubble that could trigger a broad economic crisis. The article cites figures including Jim Rickards, Jeremy Grantham, and Gary Gensler who argue AI-driven speculation and massive cash burn—highlighted by claims that OpenAI is losing over $1 billion per month—create systemic risk. Concerns include risky debt structures financing data centers, circular financing that inflates demand, and physical limits to GPU scaling and energy consumption. Prominent investors cited (Stanley Druckenmiller, Peter Thiel, Michael Burry) are reportedly reducing exposure or betting against AI, and analysts warn of a looming "Minsky moment" where speculative leverage could precipitate a market collapse with wide economic fallout.