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Sunday, January 4, 2015

Gyan Sangam ripple-possible cut in the Credit Card/Debit transaction costs

            The official release of the Bankers Presentation to Shri Narendra Modi is still awaited. However news of the various discussions/thoughts/ideas is slowly trickling down.

            One of the main focus areas was on Cashless transactions. PM Modi has said that  banks in India should compete for achieving maximum cashless transactions, as this would be the "best solution" to the problem of black money.   

            Cashless transactions though on the rise are not popular amongst middle and lower middle class. This applies both to sellers as well as buyers.

            In majority of the medium size business establishments, credit/debit card transactions attract an additional cost of 1.8% to 2.00% of the bill amount.

            The buyers are advised the nearest ATM location, wherein cash can be withdrawn and bill settled.

            Online payment of Utility bills or other travel related transactions attract a convenience fee.

            Such additional costs discourage Cashless transaction in our country and increase cash transactions.

            In the coming months as the Gyan Sangam ideas are put into action, it is expected that a detailed study will be done on ways and means to reduce the Credit Card/Debit Card Transactions costs.


           

            

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