Ambiguity persists on petro digital payment discounts

There's a March 31 deadline for discounts the OMCs are offering on digital payments at fuel stations

The three government-owned oil marketing companies (OMC)s were unclear on what was to happen after the Friday midnight deadline for the discounts they were offering on digital payments at retail motor fuel stations.

"We are yet to receive a communication from the (petroleum) ministry (on this). We cannot decide without a directive," said a top marketing official from of the three OMCs.

To promote digital payments after last November's currency demonetisation, Bharat Petroleum Corporation, Hindustan Petroleum Corporation and Indian Oil Corporation were directed to offer 0.75 per cent discounts as cash-back for such payments at fuel pumps. These were to be offered till end-March.

However, they've also have informed pump dealers that they will not be debited by banks for these discounts beyond Friday. "The OMCs sent a letter to dealers three to four days before that this would not happen, as banks are now able to directly deal with the OMC. The required software is being put in place," said Ajay Bansal, president, All India Petroleum Dealers Association.

"The discounts are likely to continue until there is a communication from the ministry by midnight," said another OMC official.

At present, banks debit dealers for the cash-backs to customers and share the data with the OMC concerned. The latter then refunds the dealer. Bansal added the refunds are being delayed, with payments due for 10-15 days.

The OMCs have reported a rise in digital payment since the demonetisation drive began on November 9. As on December 10, as many as 31,009 retail outlets had a point of sale (PoS) facility and Rs.307.6 crore of cashless transactions were made through these since demonetisation. The two private fuel retailers were forced to offer similar discounts.

Fuelling uncertainty

• After note ban, three government-owned OMCs were directed to offer 0.75% discount on digital payments
• These discounts were to be offered till March 31
• No directive has been passed whether discounts are to be continued 
• OMCs have reported a rise in digital payments since demonetisation was announced