To encourage digital transactions, the Finance Ministry has directed all public sector banks (PSUs) to reduce their fees for various transactions above Rs 1000 settled through various digital modes up to March 31, 2017. It said that PSUs shall not charge fees for transactions settled on Immediate Payment Service (IMPS) and Unified Payments Interface (UPI) in excess of rates charged for National Electronic Funds Transfer (NEFT) for transactions above Rs 1,000, with service tax being charged at actuals.
Ministry added that for Unstructured Supplementary Service Data (USSD) transactions above Rs 1,000 a further discount of 50 paise on these rates shall apply. USSD is mobile short code message and used mainly for banking services on feature phone. The USSD fee is Rs 1.50, which has been waived till December 30, 2016. As per Reserve Bank of India (RBI) norms, NEFT transactions between Rs 10,000 and less than Rs 1 lakh attract a fee of Rs 5, those between Rs 1 lakh and Rs 2 lakh attract a fee of Rs 15, and the fee for transactions above Rs 2 lakh is Rs 25. RBI has also rationalised the Merchant Discount Rate (MDR) for debit card transactions up to Rs 2,000 for the 3-month period.
To promote digital transaction, Niti Aayog had announced two schemes - Lucky Grahak Yojana and Digi Dhan Vyapar Yojana’. The schemes cover small transactions between Rs 50 and Rs 3,000. Earlier, the Centre announced a bevy of measures to boost digital transactions, including a waiver of service tax on digital payments amounting to less than Rs 2,000, discounts on petrol and diesel purchases, suburban railway tickets and insurance policies bought from state owned insurance companies through electronic means.