National Payments Corporation of India (NPCI), an umbrella organisation for all retail payments, is set to reduce the fees merchants have to pay to banks, otherwise termed as the merchant discount rate (MDR), for RuPay debit card transactions.
The move, which aims to increase the use of debit cards in the country, will be implemented from 20 October 2019.
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Rupay debit cards processed across point-of-sale (PoS), eCom, and BharatQR would be eligible for this reduction.
Under the new mandate, MDR for payments more than INR2,000 ($28.16) would be 0.60%, versus the existing MDR of 0.90%.
The maximum cap in such cases has also been lowered to INR150 for each transaction from the present INR1,000.
For Bharat QR, MDR has been lowered to 0.50%. In this case, the maximum cap for each transaction would be INR150.
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By GlobalDataNPCI CEO Dilip Asbe said: “Significant reduction in MDR will encourage the use of debit cards.
“With the reduction and capping of MDR merchants will now be encouraged to accept debit cards, which up till now they were averse due to higher MDR structure.”
Last month, the RuPay card scheme was launched in the UAE and Bhutan. The scheme has been previously launched in Singapore.
Earlier this month, State Bank of India (SBI) announced plans to launch RuPay credit cards in the country.
In July, NPCI teamed up with Japan’s JCB International to launch a co-branded international offering called RuPay JCB Global Cards.
