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Last Updated : Jan 09, 2017 05:42 PM IST | Source: Moneycontrol.com

Banks-petrol pumps' spat to blow a hole in Modi‘s digital plans

The spat between banks and petrol pumps is likely to blow a hole in Prime Minister Modi‘s digital India dreams. While petrol pumps pan-India have for now deferred their decision to decline debit and credit card payments for fuel sales until January 13, the matter might raise its ugly head again soon.


Moneycontrol Bureau

The spat between banks and petrol pumps is likely to blow a hole in Prime Minister Modi’s digital India dreams. While petrol pumps pan-India have for now deferred their decision to decline debit and credit card payments for fuel sales until January 13, the matter could raise its ugly head again soon.


Banks decided to apply the merchant discount rate (MDR) or transaction charge on petrol pumps after the 50-day waiver granted by the government to boost up cashless payments after demonetisation was announced. HDFC Bank informed pump owners of up to 1 percent charge on credit card transaction value and between 0.25 percent and 1 percent on debit card payments.

Pump owners allege banks are trying to spruce up their earnings through such charges as demonetisation has led to surge in cashless payments. There are also issues on reconciliation of payments, which sometimes might get rejected at the banks' end.

Reports suggest the government is in discussion with oil companies, pump owners, and banks to rework the payment terms.

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First Published on Jan 9, 2017 08:42 am
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