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Hoping to boost the use of debit cards, the National Payments Corporation of India (NPCI) has rationalised the merchant discount rate (MDR) for RuPay debit card transactions across Point-of-Sale (PoS), eCom, and BharatQR Code-based merchant transactions.
The MDR has been revised to 0.60 per cent for transactions above ₹2,000, with a maximum cap of ₹150. This is, at present, capped at 0.90 per cent for transactions above ₹2,000, with a higher cap of ₹1,000 per transaction.
Additionally, for card-based QR transactions (Bharat QR), the MDR has also been reduced to 0.50 per cent, with a maximum cap of ₹150 per transaction.
The move comes at a time when the Budget has proposed no MDR for customers and merchants with banks and the RBI bearing the cost of it. However, payments companies and banks have opposed the proposal, and the RBI and Finance Ministry are yet to notify the scheme. But NPCI’s latest move is likely to create pressure for other payment operators as well to lower rates.
Dilip Asbe, Managing Director and CEO, NPCI, said: “Significant reduction in MDR will encourage the use of debit cards... this MDR rationalisation, along with the similar significant reduction in UPI MDR, will benefit all categories of merchants.”
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