This announcement comes on the back of the finance minister Nirmala Sitharaman's maiden budget speech when she had said that the businesses with an annual turnover of Rs 50 crore or more shall offer affordable digital modes of payment to the consumers.
Finance minister Nirmala Sitharaman on Saturday announced the exemption of Merchant Discount Rate(MDR) charges on the transactions done via UPI and RuPay modes. This is yet another move by the government to take the Indian economy towards a less-cash economy. The announcement was made post the meeting between the Finance Minister and head of public sector banks in New Delhi on Saturday.
According to this notification, companies with a turnover of Rs 50 crore shall have to provide the facility of payment through RuPay Debit card and UPI QR code to customers. This notification will be mandated by the Department of Revenue so as to achieve a smooth functioning. The government will further urge the banks to promote RuPay cards as prescribe mode of payment by the government.
MDR is the fees that a merchant pays to service providers when a customer swipes a card on the merchant’s point-of-sale (PoS) terminal. It is also levied on the online and QR based transactions. The MDR charge is distributed among three stakeholders—the bank that enables the transaction, the vendor that installs the PoS machine and the card network provider such as Visa or MasterCard.
This announcement comes on the back of the finance minister Nirmala Sitharaman’s maiden budget speech when she had said that the businesses with an annual turnover of Rs 50 crore or more shall offer affordable digital modes of payment to the consumers.
The Finance Minister also discussed the details about the meeting held between CBI director and the head of banks and assured that banks should not be worried about CBI, CVC and CAG. On the issues of bad loans and recovery, the Finance Secretary Rajiv Kumar informed the media that Rs 2.08 lakh crore were recovered through NCLT route out of which public sector banks have Rs 38,000 share.