India News | Finance Ministry Advises Banks Not to Levy Charges on Electronic Transactions

New Delhi [India], Aug 30 (ANI): The Union Ministry of Finance has advised all the banks not to collect any charges on transactions or payments made through electronic mode, the Central Board of Direct Taxes (CBDT) said in a statement on Sunday.

According to the CBDT, some representations were made that some banks are imposing and collecting charges on transactions carried out through UPI.

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These banks were charging for every transaction beyond a certain number of transaction which was in violation of the Payment and Settlement System Act, the CBDT noted.

"This is in violation of the Circular no 32/2019 dated December 30, 20219, which was issued by CBDT to clarify that based on section 10A of (Payment and Settlement System (PSS) Act, any charge including MDR (Merchant Discount Rate) shall not be applicable on or after January 1, 2020 on payments made through electronic modes," the release said.

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Hence, it said that the Ministry has advised the banks to immediately refund the charges collected, if any, on or after January 1, 2020, on transactions carried out using electronic mode prescribed under section 269SU of the IT Act and not to impose charges on any future transactions carried through electronic mode. (ANI)

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