BENGALURU/ MANGALURU: capping off a day of intense confusion when petroleum dealers threatened to stop accepting card payments, the government asked banks to defer imposing merchant transaction charges on card payments till January 13. The final call on the matter will be taken after consultative meetings between banks, dealers and oil marketing companies.
The banks’ decision also pushed all three major oil marketing companies to write to the banks asking to defer the decision.
“Considering the thrust given by the government for cashless transactions, imposition of MDR on fuel transactions will be a retrograde step,” said the BPCL communique.
"We have decided to defer the protests after the decision of banks to defer charging transaction fee till January 13. We also want banks to withdraw the recent circular in this regard. If the banks don't reverse their decision to charge the fee after June 13, then we will go in for a protest again and stop cashless payment facilities," said a member of the Petroleum
dealers association.
Earlier speaking to reporters in Mangaluru after a two-day state-level meet of petroleum dealers, Association president Ajay Bansal said, “Our margins are fixed on a per KL basis and it is 2.5 percent only and we do not have any scope to absorb these charges."
"We have specific mechanisms to compute the margin and these do not have any scope for credit card Merchant Discount Rates (MDR). This will lead to financial losses for the dealers,” he added.
The earlier announcement had left customers aghast. “I have been using credit card to fill petrol for the last four years and banks don’t impose surcharge if it is more than Rs 400. Sometimes I get cash back up to Rs 50 in a month,” said S Manjunath, a vehicle owner in Koramanagala.
However, some fuel dealers in the city will accept payments through Bhim and Paytm, said a pump owner in Bengaluru.
G R Shanmugappa, president, Federation of Karnataka State Lorry Owners and Agents Association, said: “Nearly 60% of the lorries insouth India use plastic money for fuel payments. If petrol pumps don’t accept cards, it will impact vehicular movement.”
The return of the waived-off MDR charges could have an impact on spending across sectors and put further pressure on liquidity, say experts like economist Seema Sharma from IIT-Delhi.