Daily Email Newsletter (Sign-up Free)

Rationalisation of MDR for transactions upto Rs. 2000/- (Special measures upto March 31, 2017)

RBI Circular No. DPSS.CO.PD.No.1515/02.14.003/2016-17 dated December 16, 2016

RBI Circular to the Chairman and Managing Director / Chief Executive Officers of all Scheduled Commercial Banks including RRBs / Urban Co-operative Banks / State Co-operative Banks / District Central Co-operative Banks / Payments Banks and Small Finance Banks / All Card Network Providers

1. A reference is invited to circular DPSS.CO.PD.No.2361/02.14.003/2011-12 dated June 28, 2012 on Merchant Discount Rates (MDR) structure for debit card transactions wherein banks were advised to cap the MDR for debit card transactions at not exceeding 0.75% of the transaction amount for value upto Rs. 2000/- and not exceeding 1% for transaction amount for value above Rs. 2000/-.
2. Following the withdrawal of legal tender characteristics of existing Rs. 500/- and Rs. 1000/- Bank Notes (Specified Bank Notes – SBN), in order to facilitate wider acceptance of card payments, the following special measures for debit card transactions (including for payments made to Government), are being introduced for a temporary period:
i. For transactions upto Rs. 1000/-, MDR shall be capped at 0.25% of the transaction value.
ii. For transactions above Rs. 1000/- and upto Rs. 2000/-, MDR shall be capped at 0.5% of the transaction value.
3. The above measures shall not apply to ATM transactions.

4. The above measures shall come into effect from January 1, 2017 and shall be applicable till March 31, 2017. In the intervening period, the Reserve Bank of India will review the framework for charges for electronic payment transactions, in consultation with the stakeholders.

5. The directive is issued under Section 10(2) read with Section 18 of Payment and Settlement Systems Act 2007, (Act 51 of 2007).

No comments:

Post a Comment

In comment with "Name/Url" option, only Name is mandatory to be filled.