Banks, OMCs will bear card payment charges at petrol pumps: Pradhan
January 12, 2017  17:56
Banks and oil marketing companies will bear transaction charges for the fuel bought using cards at petrol pumps, Oil Minister Dharmendra Pradhan said today.

"The decision is very clear. Consumers will not be burdened with Merchant Discount Rate (MDR). Retail outlets (petrol pumps) will also be kept out of its purview. Now it is between banks and OMCs how they share it," he said.

Pradhan was speaking to reporters after attending a meeting on the issue that was called by the Department of Financial Services, Ministry of Finance.

"It is a commercial decision and they (banks and OMCs) will sit together and sort it out," he said.

MDR is a charge levied on merchants by banks for accepting payments through credit and debit cards. This charge was passed on to consumers but post-demonetisation, the government, in a bid to promote digital payments, waived it till December 30.

Banks, after that date, decided to pass on the MDR to petrol pump operators since the government mandate was very clear that consumers should not be burdened with any additional charge for using cards for payments.

Petrol pump owners threatened to stop accepting card payments, forcing the government to broker a settlement.

Pradhan said banks and oil companies will continue to discuss as to who should bear these charges and in what proportion.

"MDR charges will be levied as per RBI guidelines of December 16," he said.

Asked if it will be shared equally between the oil marketing companies (OMCs) and banks, he said: "That is yet to be decided." -- PTI
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