Cost of digital transactions should come down: TRAI Chairman

Abhishek Law Ranchi | Updated on January 13, 2018 Published on February 17, 2017


Costs need to come down for digital transactions and payments and the calculation of such costs should not be on a random basis, R.S. Sharma, Chairman, Telecom Regulatory Authority of India (TRAI) said on Friday.

The push towards digital payments will help create a trail of the transactions so made.

TRAI, he pointed out, had already reduced the charges of USSD (Unstructured Supplementary Service Data)-based payments made on mobile phones to 50 paisa from Rs 1.50.

“We will continue to work to ensure that there is a very healthy, cost-effective ecosystem. Ultimately, digital transactions should be easier than making physical transactions,” he pointed out while speaking to BusinessLine on the sidelines of the Momentum Jharkhand Global Investors’ Summit organised here.

According to Sharma, the cost of carrying out these digital transactions at the back-end needs to calculated on the basis of “work-done-principle”.

“This is my personal opinion, but what I maintain is that the cost of carrying out digital transactions should be on work-done principle. Not some imaginary figures,” he further added.

Sources indicate that the bone of contention in this case is the merchant discount rate (MDR) levied on transactions done through credit and debit cards.

Bringing state governments on board

According to Sharma, a whole lot of policies have come up at the Central level to facilitate digital payments and improve Internet connectivity. Now, it is for the state governments to take advantage of these policies and push digital payments. “Ultimately the state governments will have to participate in the policies, like Jharkhand is doing,” he added.

Asked about bringing on board dissenting state governments – typically those run by non-BJP parties and those which have opposed the recent demonetisation drive of the Centre – Sharma said: “I will not talk about demonetisation and the objections to it. But, I do not think any state government has opposed the move towards digital payments.”

Call Drops

Talking about call drops the TRAI Chairman maintained that the regulatory body was “looking into it”.

The issue of levying penalty on telecom operators for call drops has been challenged and the matter is sub-judice. Sharma, however, said TRAI on its part has “already strengthened the quality of service norms”.

He further welcomed the use of Aadhaar–based biometric authentication of customer details (for prepaid users) and doing away with paper-based procedures.

Published on February 17, 2017
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