U-turn: Petrol pumps defer decision not to accept card payments till January 13

Petrol pump owners on Sunday night deferred till January 13 their decision to not accept credit and debit card payments for fuel sales after banks put off the move to levy the transaction (MDR) charge.

To promote cash-less transactions, the government had waived the Merchant Discount Rate (MDR) on fuel purchase post demonetisation for consumers. But after the expiry of the 50-day window, the banks have decided to levy MDR on petrol pump owners.

This meant petrol pumps having to bear 1 per cent on all credit card transactions and between 0.25 per cent and 1 per cent on all debit card transactions from January 9.

In protest of the move, petrol pump operators had decided not to accept card payments from Monday.

“We have received official communication from oil marketing companies that the transaction fee charges have been deferred until January 13, 2017. AIPDA also has decided to defer the agitation until January 13,” said Ajay Bansal, President, All India Petroleum Dealers Association (AIPDA).

Petrol pump owners association earlier said they had been “informed by HDFC Bank that we will be charged 1 per cent on all credit card transactions and between 0.25 per cent and 1 per cent on all debit card transactions from January 9, 2017.

The same will be debited to our account and net transaction value will be credited to our account”.

ICICI bank, however, has denied sending any such communication to any dealers. “We will not charge any transaction fee on card payments from Monday,” a ICICI Bank spokesperson said.

Ajay Bansal, President, All India Petroleum Dealers Association, said the bank had quoted RBI circular of December 16, 2016, for its action.

He said petrol pump margins are fixed on a per kilolitre basis and do not have any scope to absorb these charges.

“We have specific mechanism to compute the margin and these do not have any scope for credit card MDR. This will lead to financial losses for the dealers,” he said, adding that credit card machine issuers are also delaying settlements of dues.

Also, there are disputes about purchases being returned or not delivered.” 

He had earlier on Sunday said that petrol pumps have “decided to stop accepting payment through credit/debit cards from January 9, 2017”.

In Delhi, ministry officials said they were unaware of the move by the banks and have asked them to put off the levy till a system of compensating the petrol pump dealers is discussed by all stakeholders- state-run fuel retailers, banks and petrol pump owners.