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Call for Inputs: Reserve Bank of India’s Discussion Paper on ‘Charges in Payment Systems’
Call for Inputs: Reserve Bank of India’s Discussion Paper on ‘Charges in Payment Systems’

August 18, 2022

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The Reserve Bank of India (RBI) has released a discussion paper on “Charges in Payment Systems” for stakeholder consultation (Discussion Paper). This comes after RBI had announced in its ‘Statement on Developmental and Regulatory Policies – December 2021’ about the same. The objective behind this Discussion Paper is to ensure that charges for payment services are reasonable and determine competitively for users while also providing optimal revenue stream for the intermediaries. Therefore, a comprehensive review of various charges levied in the payment systems has been sought. The Discussion Paper covers aspects related to charges in payment systems including – Immediate Payment Service (IMPS), National Electronic Funds Transfer (NEFT), Real Time Gross Settlement (RTGS) and Unified Payment Interface (UPI), as well as payment instruments including – debit cards, credit cards, and Prepaid Payment Instruments (PPIs).

In the Discussion Paper, the RBI has sought answers to the following questions on various payment systems and instruments:

Real Time Gross Settlement System (RTGS)

  • Should RBI review the policy of not levying charges on members for RTGS transactions?
  • Should the time-variable charges be re-introduced?
  • For RTGS transactions, should RBI prescribe the charges that can be levied on customers by members, or should they be market driven?

National Electronic Funds Transfer System (NEFT)

  • Should RBI charge member banks for transactions processed through NEFT?
  • Should banks be permitted to charge customers for NEFT transactions, whether initiated online or otherwise?
  • Should RBI prescribe charges for NEFT transactions to be levied by banks on their customers, or should they be market driven

Immediate Payment Services (IMPS)

  • Should charges for IMPS transactions be regulated by RBI?
  • Should RBI fix a ceiling on charges that can be imposed in IMPS?

Debit cards

  • Should debit card transactions be charged as normal funds transfer transactions?
  • Should MDR for debit cards be uniform across merchants (irrespective of turnover)?
  • Should RBI regulate interchange for debit card transactions?
  • Should RBI deregulate MDR for debit card transactions and let stakeholders decide on
    optimum level of MDR and interchange?
  • Should MDR for debit cards be a percentage of the transaction value or should it be a
    fixed amount irrespective of the transaction value?
  • Should RuPay cards be treated differently from other debit cards affiliated to
    international card networks in terms of MDR?
  • Among the two options (waiving / reducing MDR, or giving incentive to cardholders),
    which is more effective for increasing use of digital payments

You can find the detailed questions on other payment systems and instruments here.

Kindly share your inputs on the Discussion Paper by September 19th to apurva@nasscom.in.


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Apurva Singh
Senior Policy Associate

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