Petrol Pump Dealers Across States Threaten Cash-Only Move Over UPI MDR

According to Pratidin Time, petrol pump dealers across several Indian states have threatened to stop accepting UPI payments for transactions of Rs 2,000 or more. The proposed move comes in response to the potential implementation of a flat Rs 5 merchant discount rate (MDR) on these digital transactions, which retailers argue would significantly impact their profit margins.

Dealers in regions including Delhi-NCR, Punjab, Uttar Pradesh, Maharashtra, Karnataka, and Rajasthan have voiced their opposition to the charge. Industry representatives state that current margins for fuel retailers hover between Rs 2.40 and Rs 3.40 per litre. They contend that absorbing additional transaction fees would render digital payments unsustainable for their businesses.

Monty Sehgal, spokesperson for the Federation of All India Petroleum Traders, indicated that fuel retailers may be forced to restrict UPI usage if an exemption is not granted. The standoff highlights broader concerns within the retail sector regarding the costs associated with the widespread adoption of digital payment infrastructure in India. As of now, no official resolution from payment regulators or oil marketing companies has been announced to address the dealers' demands.