Skip to main content

Govt to bear MDR cost for online payments of up to Rs 2,000

Govt to bear MDR cost for online payments of up to Rs 2,000
In an effort to boost digital payments in India, the government has decided to bear the merchant discount rate (MDR) charges for transactions up to Rs 2,000 made through debit cards, BHIMUPI or Aadhaar Pay for two years.
The decision will be effective from January 1, when the Reserve Bank of India´s (RBI´s) revised guidelines on the MDR come into force.The MDR is the rate charged to a merchant by a bank for providing debit and credit card services.It is expressed as a percentage of the transaction amount.
The outgo on account of reimbursement for MDR charges is estimated to be Rs 2,512 crore over the next two years.The amount to be reimbursed to banks could be Rs 1,050 crore in FY 2018-19 and Rs 1,462 crore in FY 2019-20 for transactions of value less than Rs 2,000, said the Union government in a press statement.
The government has set up a committee to look into the industry cost structure of such transactions, which will form the basis to determine the levels of reimbursement.

“The compensation to banks will help cover the costs incurred in managing card payment operations.This should give push to volumes in digital banking space and enable to beef up merchant acquisition infrastructure,” saidPKGupta, managing director of retail and digital banking, State Bank of India.
Deepak Chandnani, managing director of Worldline, South Asia and Middle East, said, “Benefits to merchants will be two pronged –one, they will bear zero cost for electronic debit card transactions; two, it will reduce the need and cost of handling cash at the outlet.” The average ticket size for debit card transactions is Rs 1,400-1,500, bringing the MDR for merchants to zero, according to Vishwas Patel, cochair of the Payments Council of India.
The Business Standard, New Delhi, 16th December 2017

Comments

Popular posts from this blog

Deposit gush:-CA Institute Bats for Special Audit

Obligation for the Month of May 2017

Obligation for the Month of May 2017 Event DateActApplicable FormObligation6-May-2017Service TaxChallan No.GAR-7E-Payment of Service Tax for April by Cos7-May-2017Income TaxForm No.27C (TCS)Submission of Forms received in Apr  to IT Commissioner7-May-2017Income TaxChallan No.ITNS-281Payment of TDS/TCS deducted/collected in Apr10-May-2017ExciseER-1Return for Non SSI assessees for Apr10-May-2017ExciseER-2Return for EOUs for Apr10-May-2017ExciseER-6Return by units paying duty >  1 crore (CENVAT + PLA) for Apr12-May-2017D-VATBE - 2Advance information for 2nd fortnight of May of functions with booking cost > Rs 1 lakh in Banquet Halls,hotels etc. in Delhi15-May-2017D-VATDVAT-20Deposit of DVAT TDS for  Apr15-May-2017Income TaxForm 27EQTCS Returns by ALL Collectors15-May-2017Providend FundElectronic Challan cum Return (ECR)E-Payment of PF for Apr15-May-2017D-VATDVAT-48 Return of DVAT TDS for quarter ending March21-May-2017ESIESI ChallanPayment of ESI of Apr21-May-2017M-VATMVAT ChallanPa…

RBI minutes show MPC members flagged upside risks to inflation

RBI minutes show MPC members flagged upside risks to inflation Concerns about economic growth and easing inflation prompted five of the six monetary policy committee (MPC) members to call for a cut in the repo rate, but most warned that prices could start accelerating, show the minutes of the panel’s last meeting, released on Wednesday. The comments reflected a tone of caution and flagged upside risks to inflation from farm loan waivers, rise in food prices, especially vegetables, price revisions withheld ahead of the goods and services tax, implementation of house rent allowance under the 7th pay commission and fading of favourable base effect, among others. On 2 August, the panel chose to cut the repurchase rate—the rate at which the central bank infuses liquidity in the banking system—by 25 basis points to 6%. One basis point is one-hundredth of a percentage point. Pami Dua, professor at the Delhi School of Economics, wrote that her analysis showed “a fading economic growth outlook, as …