In a major push to strengthen digital economy, the Reserve Bank of Indiahas decided to offer discounts to merchants for transactions below Rs 2000. Till date, transactions below Rs 2000 come with a tax levied by banks towards the merchants.
RBI has also directed banks as well as prepaid companies not to levy any charge customers for transactions up to Rs 1000 through USSD, IMPSorUPI.
USSD or unstructured supplementary service data is the *99# service, which is hosted by the National Payments Corporation of India (NPCI) and is being promoted by the government for payments in rural areas as it does not need smartphones or internconnectivity. Further IMPS or Immediate Payment Service and UPI or Unified Payments Interface are other NPCI hosted services which is also being promoted by government for more peer to peer digital transactions.
Both of these instructions from the regulator would be applicable from January 1 of next year till March 31, since anyway these charges have been waived off till December end.
“For transactions up to Rs 1,000, MDR shall be capped at 0.25% of the transaction value and that above Rs 1,000 and upto Rs 2,000, MDR shall be capped at 0.5% of the transaction value,, said the RBI in a statement released on Friday.
It did not say anything about changes in MDR for transactions above Rs 2,000. The regulator has further added that these changes would not be affected on ATM transactions. It would review the charges in the meantime by consulting with various stakeholders, which could include banks, payment companies and the government.