Petrol Pump UPI Alert: The government has introduced a new rule regarding UPI, set to take effect on October 15. Starting from this date, an MDR (Merchant Discount Rate) fee of 0.4% will apply to UPI payments exceeding ₹2,000 made to merchants. Customers will not have to pay this MDR fee; merchants will bear the cost. However, a fixed MDR of ₹5 will be charged on purchases of petrol, diesel, or CNG exceeding ₹2,000.

Merchants oppose MDR fees on UPI payments, and protests are occurring across the country. Similarly, petrol pump dealers in Madhya Pradesh (MP) have stressed that, starting October 16, they will not accept UPI payments for petrol or diesel purchases exceeding ₹2,000.

Refusal to Accept UPI Payments Over ₹2,000 at Petrol Pumps
Ajay Singh, president of the MP Petrol Pump Dealers Association, stated that if the government does not withdraw the MDR rule, association members have decided to stop accepting UPI payments above ₹2,000 at their petrol pumps from October 16. He noted that under the new system, a petrol pump would incur a monthly loss of ₹17,700. With 4,700 petrol pumps in MP, their margins would shrink, making it impossible for them to shoulder this additional expense.

CAIT Concerned Over Dealers’ Decision
The Confederation of All India Traders (CAIT), an organisation representing retail traders, expressed serious concern on Friday regarding the decision taken by petrol pump dealers in MP, noting its impact on digital transactions. Dharmendra Sharma, president of CAIT’s Bhopal unit and media in-charge for MP, stated that this decision would affect approximately 4,700 petrol pumps across the state. He made this statement while linking the issue to the proposed Merchant Discount Rate (MDR) on UPI transactions.

Traders Concerned About MDR
Meanwhile, Dharmendra Sharma noted that for years, UPI has been a cornerstone of both the ‘Digital India’ initiative and business operations. However, traders are now deeply concerned about the proposed MDR applicable to UPI transactions that would apply to UPI transactions that exceed ₹2,000; this proposal implies a rate of ₹40 on a payment of ₹10,000. Additionally, there is talk of imposing an MDR of ₹5 on fuel transactions exceeding ₹2,000.