Recent developments have given a fillip to electronic transactions including card payments even at smaller merchant establishments
GN Bureau | February 17, 2017
The Reserve Bank of India (RBI) has sought public feedback the draft circular on rationalisation of Merchant Discount Rate (MDR) for debit card transactions.
MDR is the rate charged to a merchant by a bank for providing debit and credit card services. The rate is determined based on factors such as volume, average ticket price, risk and industry.
Read: Two counts of failure
An RBI circular said that recent developments have given a fillip to electronic transactions including card payments even at smaller merchant establishments. Keeping this in mind, for encouraging a wider segment of merchants to accept card payments, consultations were held with stakeholders for rationalising the MDR structure for debit card transactions.
“This draft circular is the culmination of these discussions and seeks a shift from the present slab-rate MDR based on transaction value to merchant turnover based MDR structure, for which merchants have been suitably categorised. Further, a differential MDR structure for asset light card acceptance infrastructure like QR Code, special merchant categories for government transactions and other transactions involving non-discretionary expenses have also been proposed. Banks are free to set the MDR below the regulatory caps indicated for each category.”
Read: Demonetisation is a major driver that is forcing people towards digital payments: Nasscom president
In March 2016, a concept paper was published on RBI website that spelt out various options for rationalisation of MDR structure along with strategies to enhance card acceptance infrastructure in the country. Further, on December 16, 2016, special measures pertaining to MDR on debit card transactions were introduced for a three month period from January 01, 2017 to March 31, 2017, wherein it was indicated that the framework for charges on electronic transactions will be reviewed in consultation with the stakeholders as it is imperative to formulate a longer term MDR structure while assessing costs incurred in card acquiring business.
Earlier, in June 2012, a regulatory cap was put in place on MDR for debit card transactions on ad-valorem basis.
Read: RBI’s draft circular - Rationalisation of Merchant Discount Rate (MDR) for debit card transactions
The union cabinet on Wednesday approved the proposal for revival of public sector telephony companies BSNL and MTNL by administrative allotment of spectrum for 4G services, debt restructuring by raising of bonds with sovereign guarantee, reducing employee costs, monetisation of assets and in-principle appr
The voters’ trust in Brand Modi is not a short-term affair – if anything, it is only increasing, or so it seems going by the numbers exit polls have given after the Maharashtra and Haryana assembly elections. Predictions from three TV channels differ widely but each has the BJP/NDA in the top p
Fact Sheet: Maharashtra assembly elections * Date of polling: 21 October * Date of counting 24 October * Assembly Constituencies: 288 * 2014 results: The BJP contested 260 states, and won 122, with a voting percentage of
The much hyped ‘double engine’ model of governance on which the BJP is seeking votes has utterly failed, and Mumbai and Maharashtra have had to face some of the worst effects of economic slowdown, former prime minister Manmohan Singh has said. A lot of problems facing Maharashtra
A three-term Rajya Sabha member, Sanjay Raut is the Shiv Sena spokesperson and its voice in parliament. He is also the executive editor of Marathi newspaper Samana, started by Shiv Sena founder Bal Thackeray. Raut spoke with Geetanjali Minhas on his party’s seat-sharing agreement
Ashish Shelar, 47, was the president of the Mumbai city unit of the BJP, before he became the minister of school education, sports and youth welfare in the Maharashta government this year. He has represented the Vandre West constituency in the state assembly and seeking re-election. In a chat with