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8:52 pm - Thursday April 26, 2018

Playing with MDR a futile exercise: CAIT

Agencies, New Delhi

The Confederation of All India Traders (CAIT) has said that Merchant Discount Rate (MDR) is s complex issue as far as digital payments are concerned in India and playing with it is a futile exercise.

In a statement issued here on Saturday, CAIT said that trade and consumer want MDR free digital payments. It said, “Whether a lower or higher MDR ultimately it is an extra financial burden on either the merchant or consumer.

Since Cash is available and without any surcharge both merchant and consumer does not want to pay any charge while making payments.” “The transaction charges are major deterrent in adoption and acceptance of digital payments in the Country.

If digital payment is encouraged without any MDR then more and more people could be role in to use digital payments,” said CAIT. The traders body said, “It will be worthwhile if Government subsidies MDR directly to the Banks, if they have any shortfall in their revenue protecting both merchant and consumer from burden of MDR.”

It is estimated that Government is spending about Rs 25000 crore annually on printing of currency and about 6000 crore rupees are spent on security, logistics etc of the currency.

If digital payment is intensified with no MDR, the cost of printing currency will come down and on the other hand Banks will also invest less in transportation of currency for ATM filling and for other purposes.

It will be a win-win situation for everyone. CAIT demanded that the Government should constitute a separate body for RuPay and National Payment Corporation of India (NPCI) should be made an independent regulator.

It also suggested that Government should also constitute a Digital Payments Monitoring Board to monitor digital payment landscape in the Country. Equal opportunity should be given to all technology providers to leverage Digital Payments in India to the best of their ability and resources.

Merely playing with MDR is a futile exercise and we want a MDR free digital payment society else cash is the available resource for meeting the transactions, said CAIT.

Posted in: Business

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