HYDERABAD: Two years since demonetisation that followed an unprecedented digital push towards cashless transactions, swiping a debit card appears no one’s first choice. This is primarily because banks remain mum on tainted merchants looting their customers to earn extra money for debit card transactions.
The next time you are bullied by a merchant to either pay 2 per cent extra on transactions using debit card or run around to find an ATM to pay with cash for avoiding the ‘extra charge’, contact the bank which has issued ePOS (electronic point of sale) machine to the respective merchant and lodge a complaint against him. As per rules, this seems to be the only way for ending this menace as banks do not seem to be bothered to take any action against such merchants despite Reserve Bank of India having issued notice as long back as in 2013 declaring levying of extra charges by merchants on debit card payments as ‘unjustifiable’ and clearly mentioning that banks should severe ties with such merchants.
On “levying fees on debit card transactions by merchants”, the notice said, “Such fees are not justifiable and are not permissible as per the bilateral agreement between the acquiring bank and the merchants and therefore calls for termination of the relationship of the bank with such establishments.”Moreover, this year the Central government has decided to subsidise Merchant Discount Rate (MDR) for cashless transactions up to Rs 2,000 for two years.
This means if you buy anything below Rs 2,000 and use debit card to pay it, the merchant does not have to pay any charges on it to the bank. MDR is amount paid by merchants to bank whose ePOS they are using.
As per August 2018 data by RBI, there were 33,32,484 ePOS in the country, of which more than 70 per cent are owned by five banks - State Bank of India (5,51,934), Ratnakar Bank (5,43,773), Axis Bank(5,07,512), HDFC (4,15,769) and ICICI (3,43,676).
The Central government is trying to increase number of cashless transactions in the country, that was one of the chief aims behind launching demonetisation drive two years back. However, merchants levying extra charges on their own for debit card transactions is proving a major discouragement for many to take up cashless transactions.
There are no dedicated complaint phone numbers by any bank which customers can dial to complaint. When contacted, GNT Raju of Merchant Acquiring Business division, State Bank of India, said, “If SBI receives complaint against any merchant, action will be definitely taken.” He said, without complaint by customers the bank will not know if a person has been charged extra for debit card transaction and that one can complaint on 1800112211, if ePOs machine used by merchant is of SBI.