In a major move to promote cashless transactions in the country, the Reserve Bank of India has given banks the freedom to fix bank service charges for transactions.
The RBI has deregulated interest rates on credit card dues. Interest rates are determined by banks with the approval of their respective Board of Directors subject to regulatory guidelines on the interest rate on advances issued by RBI from time to time. RBI does not maintain information on the rate of commission charged.
RBI has deregulated interest rates on credit card dues. Interest rates are determined by banks with the approval of their respective Board of Directors subject to regulatory guidelines on the interest rate on advances issued by RBI from time to time. RBI does not maintain information on the rate of commission charged.
National Bank for Agriculture and Rural Development (NABARD) has approved a scheme for giving 0.5 percent incentive on payments made through the Aadhaar Enabled Payment System (AEPS) to merchants.
With regards to debit card transactions on PoS devices, between January 1 and March 31, 2017, Merchant Discount Rate (MDR) has been capped at 0.25 percent for transaction value between Rs. 1,000 and Rs. 2,000, MDR has been capped at 0.5 percent.
RBI has decided that till March 3, 2017, banks and prepaid payment instrument issuers shall not levy any charges on customers for transactions up to Rs. 1,000 settled on Immediate Payment Service (IMPS), Unstructured Supplementary Service Data (USSD) and Unified Payments Interface (UPI).
Further, Government has issued a direction in public interest to all public sector banks not to charge fees for transactions settled on IMPS and UPI in excess of rates charged for National Electronic Funds Transfer (NEFT) for transactions above Rs. 1,000, with service tax being charged at actual; for USSD transactions till March 3, 2017, above Rs. 1,000, a further 50paise discount is provided.
