Home News Government asks Banks to cut the e-payment charges
Published On : Dec 22, 2016

After the demonetization, several good and bad things happens in our India. Our Prime Minister Narendra Modi, He decided to announce currency demonetization on November 8, 2016. And he also promotes digital transaction as well. Now, for encouraging digital e-payments the government on this Wednesday asked to all public sector


like SBI(State Bank of India), BOB(Bank of Baroda), Canara Bank, etc.. to lower the charges for electronic payments up to March 31, 2017.

"To the further promote digital and card payments, the Department of Financial Services, Ministry of Finance has issued a direction in public interest to all public sector banks. That was these banks shall not charge fees for transactions settled on Immediate Payment Service (IMPS) and Unified Payments Interface (UPI) more than rates charged for National Electronic Funds Transfer (NEFT) for transactions above Rs 1,000, with service tax being charged at actuals," the government order said.

The Government's notice did not specify from when these new charges would apply, and it stated that these Government statements are would use for all transactions up to March 31, 2017. And the another statement is "For the USSD ( Unstructured Supplementary Service Data ) transactions above Rs 1,000, a further discount of 50 paise on these rates shall apply".

The Reserve Bank of India in the last week instructed banks to remove all charges on customers for electronic payments up to Rs 1,000 settled on IMPS, USSD or UPI systems on January 1, 2017, to March 31, 2017. The RBI has also reorganised the Merchant Discount Rate (MDR) for debit card transactions up to Rs 2,000 over the same time.

The Digital India

Digital India is a campaign, that launched by the Government of India to ensure that Government services are made available to all citizens electronically by improving the basic knowledge of online methods and by increasing Internet connectivity or by making the country digitally empowered in the field of technology. The Digital India project was launched on 1 July 2015 by Prime Minister Narendra Modi. The initiative includes plans to connect rural areas with high-speed internet networks.