Hard Cash Day 18: Service charge waiver not in effect everywhere!
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Hard Cash Day 18: Service charge waiver not in effect everywhere!

Despite the Central government's decision to waive service charge on electronic payments till December end, several retailers in Noida are still levying the charge.

Hard Cash Day 18: Service charge waiver not in effect everywhere! Picture used for representative purpose only

Contrary to Central government’s decision to waive service charge on payments made through debit cards and internet banking, several retailers in Noida are still levying the charge. According to a few shopkeepers, this is because the banks have not intimated them about the decision yet.

At a press conference held recently, Shaktikanta Das, secretary of economic affairs, had said that all public sector banks and a few private sector banks would waive transaction cost for all payments made through debit cards until December 31.

The service charge on transaction cost is commonly known as merchant discount rate (MDR) and is levied by the bank for the use of electronic payment infrastructure.

According to the norms of Reserve Bank of India, the MDR for each transaction below Rs 2,000 is .75 per cent and above Rs 2,000 is 1 per cent. This is to be borne by the retailers. But some retailers collect MDR from customers at a rate of 2 per cent in violation of the rule. 

When City Spidey spoke to a staff member of Sangam Electronics, a retail outlet of home appliances in Sector 18, he said that the waiver on service charge had not been implemented because their bank had not intimated them about it. He added that after demonetisation, payments through debit cards had increased and that they levied a service charge of 2 per cent for electronic payments.

Surya Prakash, a resident of Sector 93, said that some retailers in Sector 18 avoided taking credit card payments as it took two to three days for the money to be transferred to their accounts. He also alleged that as retailers wanted to avoid showing huge turnout to evade tax payment, they desisted from card transactions.

But Harish Gupta, a retailer who runs Ankur Electronics in Sector 18, said, “We are not levying service charge for electronic payments. We manage the service charge from our profit margin.”

Uday Jain, a resident of Prateek Laurel (Sector 120), told City Spidey, “I have been using internet banking after demonetisation. An extra Rs 57 was deducted from the debit card when I paid my utility bills. The government should permanently waive the service charge on electronic payments for greater number of digital transactions.”

Lokesh Agarwal, a resident of Mahagun Moderne (Sector 78), shared Jain’s opinion. He said, “The December 31 deadline is not enough — it should be extended further. More people will go for electronic payments if the waiver is permanent.”