In a bid to promote digital transactions, Finance Minister Arun Jaitley expressed confidence during the question hour in the Rajya Sabha that the charges on digital payments would come down with increase in volumes. Newer technologies are making digital transactions cheaper and it is expected that more people would move towards them, he said, adding that the government has also advised its officials to use digital money. He said the Reserve Bank of India (RBI) is working to fix the Marginal Discount Rate (MDR) charges for debit card transactions above Rs2 lakh. Mr Jaitley said that under the Payments and Settlements Act, the RBI has held that for cash transactions up to Rs1000 the MDR rate would be 0.25%, while for transactions up to Rs2000 it has been fixed at 0.50%.
Mr Jaitley explained that with regard to debit card transactions in petrol companies, the charge is being absorbed by oil companies, while for digital transactions for rail travel it is being absorbed by the government.
Responding to another question on the demonetisation decision in the Rajya Sabha, Mr Jaitley said the RBI had begun printing the new currency well in advance but it was the process of recalibration of ATM machines that took time due to the need for maintaining secrecy.