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Dec 07, 2017 12:27 PM IST | Source: Moneycontrol.com

Indian Railways will soon offer incentives for cashless payments

Railways currently gives 0.5 percent discount to travellers who purchase monthly travel pass using debit or credit card.

To boost digital payments, Indian Railways is planning to offer incentives to passengers who book their tickets online.

“We are trying to minimise the use of cash as much as possible. So, several incentives are being rolled out for passengers,” Mohd Jamshed, member-traffic, Rail Board, told The Economic Times.

“The financial burden of the incentives given is being borne by us," he added.

Railways currently gives 0.5 percent discount to travelers who purchase monthly travel pass using debit or credit cards.

Similarly, the railways plans to introduce discounts and other incentives for cashless payments, reports ET. The facility is likely to be extended to unreserved category as well.

For waiving off the service charge on IRCTC, the government is taking a hit of nearly Rs 400 crore. Nearly 60 percent of total transactions done are currently cashless.

These cashless transactions have risen 20 percent since demonetisation, which was implemented last November. Since then, the railways have also started providing point-of-sale (PoS) machines at ticket counters to enable card payments.

Since cash ban, payments via e-wallets like BHIM have also gained momentum.

The railways is now aiming to go cashless by having 85-90 percent cashless payments. For that, it has asked banks to waive off the charges applicable on digital payments for booking tickets online.

"Railways is benefiting from it as we are reducing the cost of handling cash," Jamshed said.

According to an earlier report, the government was also considering removal of merchant discount rate (MDR) charges applicable on payment via debit or credit card. If the charges are reduced or removed, then rail fares will reduce making travel cheaper.
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