NEW DELHI: Petrol pump dealers in Madhya Pradesh and several other parts of India have raised concerns over the proposed 0.4% Merchant Discount Rate (MDR) on UPI transactions, with some warning that they may stop accepting digital payments above ₹2,000 from October 15.
The proposed move could affect customers who regularly use UPI to pay for fuel, particularly those making larger purchases at petrol stations.
Dealers are demanding a complete exemption from MDR on UPI transactions at fuel outlets. They argue that rising operational expenses and unchanged fuel commissions have made it difficult to absorb additional payment processing charges.
The All India Petroleum Dealers Association has also called for a full waiver of MDR on UPI payments made at petrol pumps. Dealers in Madhya Pradesh have separately urged authorities to withdraw the proposed charges and exclude fuel sales from the MDR framework.
The issue has attracted attention from the Confederation of All India Traders (CAIT), which has expressed concern over the possibility of petrol pump dealers imposing limits on UPI payments. The organisation has described the proposed restriction on transactions above ₹2,000 as a matter requiring attention.
If dealers implement the proposed limit, customers could face difficulties when using UPI for higher-value fuel purchases. However, the reported restriction is a warning from certain dealers and does not establish that all petrol pumps across the country will stop accepting UPI payments above ₹2,000.
The dispute highlights ongoing concerns among fuel retailers about payment-related expenses and the financial impact of additional transaction charges on petrol pump operations.
