MUMBAI: Even as the government tries to push debit card use, banks proceed to hit shoppers with unreasonable charges for incidents corresponding to transactions declined for want of minimal balance. Each time a buyer swipes a card without good enough balance in his bank account, between Rs 17 and Rs 25 is debited from him. The acceptable fee of GST is added too.
SBI charges Rs 17 every time a debit card swipe is declined at either an automated teller machine (ATM) or a point of sale (PoS) terminal. HDFC Bank and ICICI Bank rate Rs 25 as transaction decline charges at PoS machines.
IIT-Bombay professor (mathematics) Ashish Das said, “For debit card utilization for non-cash merchant transactions, these exorbitant fees make no sense and by no means incentivise the government’s wish of marketing bills thru card and digital.” Das has authored a number of research reviews on financial institution charges and has been instrumental in converting regulatory policies up to now.
The fees on declined transactions persist even as the government has capped merchant cut price fee or MDR — the fees imposed by way of banks on traders who settle for card bills. Also, banks are working campaigns encouraging shoppers to use debit cards at stores for bills and no longer visit their branches or ATMs.
Das added, “The provide device is very anti-digital and unnecessarily dangerous (when it comes to fees) for people who have no nice financial savings but live on per month wage. Such charges simplest disincentivise and create negatives for digital bills.”
Banks have argued that the reason is equal to the only behind cheque decline charges, that are much upper. Charges very similar to cheque bouncing are also carried out on failed ECS (electronic clearing services) debit transactions. Das said, “Cheque/ECS returns contain 3rd parties and create distrust within the cost mode. These should be discouraged and thus severe deterrents should be put in place within the form of penalty. However, decline of an ATM transaction due to insufficient balances is nowhere on a par with cheque/ECS returns. It does no longer contain any 3rd birthday celebration. Moreover, National Payments Corporation of India (NPCI) does no longer consider it a transaction and therefore no interchange is paid by way of the card-issuing financial institution.”
According to Das, if there's misuse of debit cards, banks may just at least set a flooring of two loose declined merchant transactions per month due to insufficient finances and thereafter impose a cheap rate.
SBI charges Rs 17 every time a debit card swipe is declined at either an automated teller machine (ATM) or a point of sale (PoS) terminal. HDFC Bank and ICICI Bank rate Rs 25 as transaction decline charges at PoS machines.
IIT-Bombay professor (mathematics) Ashish Das said, “For debit card utilization for non-cash merchant transactions, these exorbitant fees make no sense and by no means incentivise the government’s wish of marketing bills thru card and digital.” Das has authored a number of research reviews on financial institution charges and has been instrumental in converting regulatory policies up to now.
The fees on declined transactions persist even as the government has capped merchant cut price fee or MDR — the fees imposed by way of banks on traders who settle for card bills. Also, banks are working campaigns encouraging shoppers to use debit cards at stores for bills and no longer visit their branches or ATMs.
Das added, “The provide device is very anti-digital and unnecessarily dangerous (when it comes to fees) for people who have no nice financial savings but live on per month wage. Such charges simplest disincentivise and create negatives for digital bills.”
Banks have argued that the reason is equal to the only behind cheque decline charges, that are much upper. Charges very similar to cheque bouncing are also carried out on failed ECS (electronic clearing services) debit transactions. Das said, “Cheque/ECS returns contain 3rd parties and create distrust within the cost mode. These should be discouraged and thus severe deterrents should be put in place within the form of penalty. However, decline of an ATM transaction due to insufficient balances is nowhere on a par with cheque/ECS returns. It does no longer contain any 3rd birthday celebration. Moreover, National Payments Corporation of India (NPCI) does no longer consider it a transaction and therefore no interchange is paid by way of the card-issuing financial institution.”
According to Das, if there's misuse of debit cards, banks may just at least set a flooring of two loose declined merchant transactions per month due to insufficient finances and thereafter impose a cheap rate.
Customers hit with debit card decline charges
![Customers hit with debit card decline charges]()
Reviewed by Kailash
on
March 22, 2018
Rating:
