Removal of merchant discount rate (MDR) brings opportunity for OMC
By MYBRANDBOOK
India’s acceptance of digital payment modes will accelerate with this kind of change on more payments options. With the intention of making zero fees to merchants will lead to more acceptance of digital payments. Oil marketing companies will save ₹400-500 crore annually every year with the proposed removal of merchant discount rate (MDR)
MDR is a card transaction fee paid by the merchant—in this case, the fuel company—and shared by banks which put up the swipe machine and issue the card, and payment networks like Visa and Mastercard and the MDR is not passed on to customers. MDR is a charge levied for facilitating a digital transaction and is generally distributed among various parties. Currently, merchants bear the cost of MDR that is around Rs 12-15 per transaction.
Merchant Discount Rate (MDR) subsidy, that was issued by govt last year in December, to waive off all transactions fee from digital transaction upto Rs 2000 and reimburse banks, is still due. The scheme has started in January 2018 and no payment has been made to payment aggregators .Those firms were having 20 basis points (on an average) for each transaction through debit cards until December 31, 2017. Later, RBI capped the MDR to 0.4 per cent of the transaction value for transactions up to Rs 2000.
The govt has to pay the above mentioned per cent to banks instead of merchants. Here, banks will be responsible to pay all parties. To promote digital transaction via low-cost digital payments modes such as BHIM UPI, UPI-QR Code, Aadhaar Pay, Debit cards, NEFT, RTGS, the government has proposed to abolish all charges levied on merchants or customers who perform transactions through these modes.
The present Union Budget 2019, FM Nirmala Sitharaman has announced, that there should be no charge on merchant discount rate (MDR) for companies with more than Rs 50 crore turnover accepting payments through digital means.
As of now, the government doesn’t levy charges on transaction up to Rs 2,000 via debit cards, BHIM and other UPI-enabled payments apps. Whereas, the banks and payment firms have keen on having this issue sorted out.The move faced criticism from payment firms, who think this will lead to more job losses.
The decision might affect digital payments growth in the long run and it will hurt payment firms including banks and merchant onboard on them, banks said.
BREAKING NEWS
TECHNO TRENDS
Legal Battle Over IT Act Intensifies Amid Musk’s India Plans
The outcome of the legal dispute between X Corp and the Indian government c...
Wipro inks 10-year deal with Phoenix Group's ReAssure UK worth
The agreement, executed through Wipro and its 100% subsidiary,...
Centre announces that DPDP Rules nearing Finalisation by April
The government seeks to refine the rules for robust data protection, ensuri...
Home Ministry cracks down on PoS agents in digital arrest scam
Digital arrest scams are a growing cybercrime where victims are coerced or ...
E-Magazine
TECHNOTAINMENT
Hrithik Roshan to endorse RuPay as Brand Ambassador
RuPay is reportedly planning to feature Bollywood superstar Hrithik Rosha
India Today Group launches – AI Pop Stars
Staying true to our industry leadership position in using cutting-edge tech
MOVERS & SHAKERS
TelioLabs ropes in Phaniraj V A as the Group CEO
TelioLabs has announced the onboarding of Phaniraj V A as its new Group CE
Wipro Appoints Amit Kumar as Managing Partner and Global Head
Wipro Limited (NYSE: WIT, BSE: 507685, NSE: WIPRO), a leading technology s
OPEN YOUR EYES
INTERVIEWS
Acer addresses evolving customer needs by consistently pushing
Acer offers a comprehensive range of products under one roof, including des
Alpha Max offers high end solutions in the network space to en
The vision at Alpha Max is to attain quality as the trademark and create a
HOT PICK
MSI Announces the availability of RTX 50 series of laptops in
MSI, the innovative computing manufacturer in gaming, creator
Nothing Phone (3a) goes on sale today, starting at Rs 19,999
The phone was launched on March 4, featuring a 50MP main, ultra-wide, and t
MAKE IN INDIA BRANDS
LENOVO INDIA PVT. LTD.
VERSA NETWORKS INDIA PVT. LTD.
TP-LINK INDIA PVT. LTD.
TATA CONSULTANCY SERVICES
EMINENT CIO'S OF INDIA
ICONS OF INDIA
Icons Of India : Arundhati Bhattacharya
Arundhati Bhattacharya serves as the Chairperson and CEO of Salesforce...
ICONS OF INDIA : SHAILENDER KUMAR
Shailender Kumar is senior vice president and regional managing direct...
Icons Of India : RAJENDRA SINGH PAWAR
Rajendra Singh Pawar is the Executive Chairman and Co-Founder of NIIT ...
PARTNER SPEAKERS
PSU
IOCL - Indian Oil Corporation Ltd.
IOCL is India’s largest oil refining and marketing company ...
BEL - Bharat Electronics Limited
BEL is an Indian Government-owned aerospace and defence electronics co...
EESL - Energy Efficiency Services Limited
EESL is uniquely positioned in India’s energy sector to address ener...
VIDEOS
Top 25 Brands
Global Indian industry
Indian Tech Talent Excelling The Tech World - Rajiv Ramaswami, President & CEO, Nutanix Technologies
Rajiv Ramaswami, President and CEO of Nutanix, brings over 30 years of...
Indian Tech Talent Excelling The Tech World - ARVIND KRISHNA, CEO – IBM
Arvind Krishna, an Indian-American business executive, serves as the C...
Indian Tech Talent Excelling The Tech World - JAYASHREE ULLAL, President and CEO - Arista Network
Jayshree V. Ullal is a British-American billionaire businesswoman, ser...
ITFORUM 2025
CMO of the Year
WOMEN LEADERSHIP
IMAGE GALLERY
TRENDS IN TECHNOLOGY
MORE VIDEOS
ADVERTISEMENTS
TECHNOLOGY DISRUPTION
UNICORNS REVOLUTIONISING
of images belongs to the respective copyright holders
