Banks Still Levy Card Fee on Fuel Pur­chases

Cus­tomers write to oil min­istry re­gard­ing ‘il­le­gal de­duc­tion’ on debit card spends

The Economic Times - - Economy: Macro, Micro & More - San­jeev.Choud­hary @Times­

New Delhi: Sev­eral banks are still im­pos­ing the trans­ac­tion fee on con­sumers pay­ing by debit card for fuel de­spite a clear in­struc­tion from the gov­ern­ment not to do so.

Sev­eral in­con­ve­nienced cus­tomers have writ­ten to the oil min­istry in the past few weeks re­gard­ing this il­le­gal de­duc­tion, an oil min­istry of­fi­cial said. The min­istry is en­gaged in per­suad­ing banks with the help of the fi­nance min­istry to re­verse th­ese charges, he said.

In or­der to boost dig­i­tal pay­ments af­ter de­mon­eti­sa­tion, the gov­ern­ment had said that no bank can levy fuel sur­charge or trans­ac­tion fee on cus­tomers pay­ing by debit cards. An RBI or­der also bars banks from levy­ing the fee on con­sumers; it di­rects them to re­cover it from mer­chants. But the petrol pump deal­ers have ar­gued that their mar­gin was too thin to pay for fuel sur­charge, which is about 2.5% plus ser­vice tax. There­fore, the gov­ern­ment clar­i­fied that petrol pumps too would not pay the fuel sur­charge and left it to oil com­pa­nies to sort this out with the banks.

The cur­rent ar­range­ment al­lows for the card is­su­ing banks to sub­mit in­for­ma­tion on daily fuel pur­chase trans­ac­tions to oil re­tail­ers such as In­dian Oil, Bharat Pe­tro­leum and Hin­dus­tan Petro- leum and get com­pen­sated. But ac­cord­ing to con­sumers and oil min­istry of­fi­cials, many banks in­clud­ing those from the pub­lic and the pri­vate sec­tor are still levy­ing fuel sur­charge.

The card-is­su­ing banks usu­ally re­spond to cus­tomers query on this by feign­ing ig­no­rance about the gov­ern­ment or­der or say they are “just keep­ing it as a buf­fer just in case the ac­quirer bank asks for it”, ac­cord­ing to some cus­tomers. The ac­quirer refers to those banks which pro­vide the point of sales ma­chines at petrol pumps. The ma­chine providers usu­ally charge for their ser­vice. Cus­tomers said it was a mam­moth task to get banks to re­verse th­ese charges. “How long can you keep call­ing their cus­tomer care, where most peo­ple would have no ready ex­pla­na­tion for this,” said a frus­trated cus­tomer, adding that not ev­ery­one would even have the time or pa­tience to write to gov­ern­ment of­fi­cials for this.

Dig­i­tal trans­ac­tions have sharply risen at petrol pumps since de­mon­eti­sa­tion. Con­sumers paid ₹ 14,000 crore digitally to petrol pumps between No­vem­ber 9 and De­cem­ber 31, ac­cord­ing to the oil min­istry data. By De­cem­ber end, dig­i­tal trans­ac­tions made up nearly 30% of to­tal sales from 10% be­fore the de­mon­eti­sa­tion.

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