Low Merchant discount rate for Debit card usage

Till recently the Merchant Discount Rates (MDR) structure for debit card and credit card transactions are same. RBI has now created a difference. The objective is to encourage Merchants to ask customer to pay through debit card as less amount will be deducted. As the debit card is a secured product as compared to Credit card less discount must exist in Debit card

 Accordingly, in consultation with the stakeholders, it has been decided to cap the MDR for transactions undertaken with debit cards as under:

1. not exceeding 0.75% of the transaction amount for value upto Rs 2000/-;
2. not exceeding 1% for transaction amount for value above Rs 2000/-.

This will be effective from 1^st July 2012