Petrol pump dealers in Madhya Pradesh and several other parts of the country have raised objections to a proposed merchant discount rate (MDR) on UPI transactions, with some dealers warning that they could stop accepting payments above Rs 2,000 from October 15.
The proposed move could affect customers who use UPI for larger fuel purchases. Dealers are seeking an exemption from the transaction charge, arguing that additional costs would put further pressure on their businesses.
Dealers seek waiver on UPI charges
According to NDTV Profit, petrol pump dealers have threatened to halt high-value UPI transactions unless fuel retailers are excluded from the proposed 0.4 per cent MDR.
The dealers have demanded a complete waiver of MDR for UPI payments made at petrol pumps. They have cited rising operating expenses and unchanged fuel commissions as reasons for their opposition, saying it would be difficult to absorb another transaction-related cost.
The issue has also been raised by the All India Petroleum Dealers Association. As reported by ANI, the association has sought a complete exemption from MDR on UPI payments at petrol pumps.
Madhya Pradesh dealers oppose proposed charge
Petroleum dealers in Madhya Pradesh have separately demanded the withdrawal of what they described as a proposed UPI tax, IANS reported. They have also called for fuel sales to be kept outside the MDR framework.
Under the proposed arrangement, the concerns are particularly relevant to transactions above Rs 2,000, as some dealers have indicated that they could restrict UPI payments beyond that amount.
Traders’ body raises concern
The issue has also drawn a response from the Confederation of All India Traders (CAIT).
PTI reported that CAIT described the proposed decision by Madhya Pradesh petrol pump dealers to stop accepting UPI payments above Rs 2,000 as a serious concern.
If dealers go ahead with the proposed restriction, customers making larger fuel purchases may have to use other payment methods at participating petrol pumps. The impact would depend on how widely individual dealers adopt the proposed limit and whether the MDR issue is resolved before October 15.