New debit card charges may prompt retailers to push for cash transactions

For shops up to revenue of Rs 20 lakh, MDR will be 0.4% of the purchase value or Rs 200, whichever is lower

The increase in debit card fee is set to make retailers push for cash transactions as retailers complain of hefty charges.

The Reserve Bank of India has revised merchant discount rate (MDR) from January next year. For shops up to revenue of Rs 20 lakh per year, MDR will be 0.4 per cent of the purchase value or Rs 200, whichever is lower. 

For stores above that bracket, MDR will be 0.9 per cent or Rs 1,000, whichever is lower. Currently, MDR is 0.25 per cent for purchases below Rs 1,000 and 0.5 per cent for those between Rs 1,000