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Last Updated : Jan 09, 2020 11:24 AM IST | Source: Moneycontrol.com

Govt may remove MDR on all debit cards: Report

The government recently scrapped MDR on payments made through Rupay debit cards and the Unified Payments Interface (UPI).


To push digital payments, the government is planning to waive merchant discount rate (MDR) on all debit cards, Hindustan Times has reported.

The move could be announced when the Union Budget is presented on February 1, the report said.

The government recently scrapped MDR on payments made through Rupay debit cards and the Unified Payments Interface (UPI).

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Commercial banks have been seeking compensation for losses related to MDR, and this could cost the exchequer Rs 2,000 crore annually.

Moneycontrol could not independently verify the report.

The finance and IT ministries had not responded to requests for comment by Hindustan Time. Spokespersons for State Bank of India (SBI) and Visa declined to comment.

Finance Minister Nirmala Sitharaman has in her July 2019 Budget speech said that business establishments with a turnover of Rs 50 crore would not be allowed to charge MDR.

On December 30, 2019, a government notification scrapped the processing fee on digital payments.

The circular also mandated all companies with a turnover of Rs 50 crore to adopt UPI and Rupay payments. The penalty for non-compliance, starting February 1, 2020, is Rs 5,000 per day, the Central Board for Direct Taxes said in a separate circular.

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First Published on Jan 9, 2020 11:24 am
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