🐘 India 🇮🇳: Regulator considers the return of debit fees

🐘 India 🇮🇳: Regulator considers the return of debit fees

Three years ago, commercial fees for transactions with UPI (Unified Payments Interface) and RuPay debit cards were eliminated to encourage digital payments. However, UPI now dominates the market and banks and payment providers have lost a key source of revenue.

➡️ Until 2022, merchants were required to pay the processing bank a Merchant Discount Rate (MDR) fee of less than 1% of the transaction amount.

➡️ The industry has formally requested the reinstatement of MDR for UPI payments, with the condition that it only applies to large merchants. These businesses already pay fees for credit card transactions and process more than 50% of their payments through this method. The next step is to determine how debit and UPI transactions will be handled.

➡️ Overall, the regulator plans to introduce a tiered fee structure, where charges will vary based on the type of merchant.

#news #India

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