In an effort to encourage digital payments, Govt of India has approved on the withdrawal of Service Charges, Surcharge and Convenience fee on any transaction done through digital medium via Credit cards, Debit Cards or digital e-wallets (like Paytm Wallet, FreeCharge wallet, MobiKwik wallet, ICICI Pocket etc.)
Govt aims to discourage direct cash transaction between persons and business while encouraging them to move to paperless digital payments.
“This is a masterstroke by the government following last year’s RBI decision to roll out payment banks. This will force companies to not levy additional charges. It should not cost more when you’re paying digitally. This is a way for consumers to learn digital.” said Paytm Founder Vijay Shekhar Sharma.
The Cabinet chaired by Prime Minister Narendra Modi has approved several short and medium term measures for implementation by various Govt ministries and departments towards pushing more electronic payments in the country.
Govt plans to mandate payments beyond a prescribed threshold only through a card or digital mode. This will bring more accountability, reduce the flow of fake notes and black money transactions.
In addition, Govt is also looking into offer tax benefits to merchants who accept electronic card payments and income tax rebates for consumers on paying their expenditure through electronic means.