Post a review meeting held with top executives of public sector banks (PSBs) Finance Minister Nirmala Sitharaman announced all the businesses with an annual turnover over Rs 50 crore will be mandated by the department of revenue to provide the facility of payment through RuPay debit card and UPI QR code, without levying any MDR fee. This change will be effective from January 2020.
Merchant Discount Rate or MDR is the amount that a merchant has to pay to its payment service providers when a consumer swipes his/her card on the merchant's point-of-sale (PoS) terminal. These are also applicable on online transactions and QR-based transactions.
MDR is distributed between bank (that enables transaction), PoS machine vendor and the card network provider (like Visa or MasterCard) and can range from nil to 2 percent of the transaction amount.
Sitharaman said the Central Bureau of Investigation (CBI) will be conducting workshops and detailed discussions with officials of PSBs to help clarify the investigation agency's process.
The review meeting was ahead of the Union Budget, which is scheduled to be presented on 1 February 2020.