Ranchi: Fuel station owners in the city are uncertain whether they will continue accepting UPI payments above Rs 2,000 after the proposed merchant discount rate (MDR) takes effect on Oct 15. Some operators are considering switching to cash only transactions if the levy is implemented.Niranjan Kumar, who runs a fuel station in Bariatu, said he may stop accepting digital payments above Rs 2,000 and put up a sign informing customers that only cash would be accepted.“If the MDR is implemented, I will have to stop accepting digital payments as it will result in losses. Operational costs have increased, while margins in the business have remained largely unchanged for a long time. MDR on UPI payments will put further strain on the business,” he said.Another fuel station owner, Rahul Jaiswal, said he hoped the govt would withdraw the proposed levy before Oct 15, providing relief to merchants.Jaiswal said petroleum companies currently reimburse fuel station dealers for MDR charged on credit and debit card transactions. He expressed hope that a similar arrangement could be introduced for UPI payments.Pramod Kumar, spokesperson for the Jharkhand Petroleum Dealers’ Association, said they are yet to take a collective decision on the issue.The Federation of Jharkhand Chamber of Commerce and Industries (FJCCI) on Thursday wrote to Union finance minister Nirmala Sitharaman and the Reserve Bank of India governor, seeking withdrawal of the proposed MDR on select UPI merchant transactions above Rs 2,000.FJCCI president Tulsi Patel said the zero MDR regime had played a key role in the widespread adoption of UPI among small traders, retailers, micro, small and medium enterprises (MSMEs), and service establishments.He said the proposed 0.4% MDR could increase operating costs for businesses, particularly those handling a high volume of digital transactions.FJCCI said businesses were already facing rising expenses related to employees, transportation, electricity, rent and compliance, while many operated on limited margins. The additional recurring cost of accepting digital payments, it said, could burden merchants and affect their willingness to accept UPI payments.The industry body urged the govt to retain the zero MDR regime and conduct a detailed assessment of the proposal’s impact on MSMEs, retailers and high-volume digital payment businesses in consultation with industry organisations.
