Govt to reimburse MDR charges levied on digital payments upto Rs 2,000

The transactions need to made through debit cards, BHIM-UPI and Aadhaar Pay

In a bid to encourage electronic payments, the central government will now reimburse the Merchant Discount Rate (MDR) applicable on transactions worth Rs 2,000.

According to the Minister of Electronics, IT and Law and Justice Ravi Shankar Prasad, the government will reimburse the MDR on conducted via debit cards, UPI and Adahar-based transactions.

The decision was taken by the Union Cabinet in its meeting held on Friday.

"The government today has taken a very major decision to accelerate digital payments in the country -- MDR charges -- up on transactions worth Rs 2,000 shall now be reimbursed by the government to the merchants and the banks," Prasad said at a press conference after the Cabinet meeting.