In a bid to boost digital payments, finance minister Nirmala Sitharaman on Saturday announced no MDR charges will be applicable on transactions through homegrown RuPay and UPI platforms beginning January 1, 2020.

The department of revenue will soon notify RuPay and UPI as the prescribed mode of payment for digital transactions without any Merchant Discount Rate (MDR), she said after meeting CEOs of public sector banks here.

Accordingly, all companies with a turnover of Rs 50 crore or more will be mandated by the revenue department to provide the facility of payment through RuPay Debit card and UPI QR code to their customers, she said.

MDR is the cost paid by a merchant to a bank for accepting payment from their customers via digital means. The merchant discount rate is expressed in percentage of the transaction amount.

Indigenously developed digital payment mediums such as RuPay and BHIM UPI will now have an edge over the payment gateway promoted by foreign companies.

She said banks will also start a campaign to popularise RuPay Debit card and UPI.

The finance minister said the government has already amended two laws — Income Tax Act and the Payments and Settlement Systems Act, 2007 — to give effect to these provisions.

The meeting was attended the chief executive of Indian Banks’ Association and representatives of leading private sector banks. The finance secretary, revenue secretary, electronics and information technology secretary, CBI director, RBI representative and the CEO of NPCI were also present in the meeting.

(Source : The Telegraph)