has proposed that small merchants may not pay more than 0.4 per cent of the transaction
value for physical PoS
(point of sale) and 0.3 per cent towards digital PoS.
All other categories of merchants (apart from government) may not pay more than 0.95 and 0.85 per cent of transaction
value for physical and digital PoS, respectively. Currently, MDR
charges on debit card
transactions stand at below 0.75 per cent for transactions less than Rs 2,000 and under one per cent for those above Rs 2,000.
said the proceeds from MDR
were tilted towards card-issuing banks
and did not leave any margins for acquirers and payment processors. The group hopes RBI
will ensure equitable distribution of proceeds from MDR
among all players in the ecosystem, PCI
The acquirers have been investing in giving small merchants access to digital payments.
These non-banking payment entities take the responsibility of not only providing the infrastructure but also managing merchant's evaluation, servicing, risk management, and education, and MDR
is the only source of revenue for these payment companies.