Demonetisation: Debit card charges dropped, farmers to get easier cash access

New Delhi: Amid the ongoing political outcry over demonetisation, the government today announced more steps to help farmers to meet their cash needs during the ongoing rabi season and directed banks to waive debit card transaction charges to encourage digital payment.

Representational image. Reuters

Representational image. Reuters

To ensure quick and unhindered flow of credit and cash to farmers during the current rabi season to deal with ban of Rs 500/1,000 notes, the government has allowed Nabard to disburse Rs 21,000 crore through cooperative banks to farmers.

Listing various measures taken by the government to incentivise digital transactions, Economic Affairs Secretary Shaktikanta Das said the Railways has already waived service charges on online booking of tickets and telecom operators have agreed to make mobile banking services in feature phones free of cost till December 31.

While government departments and PSUs have been asked to make electronic payment to contractors and its employees, the road transport ministry has asked automobile manufacturers to install digital RFID tag on all new vehicles to enable cashless payment at toll plazas and checkposts.

Similarly, the government has doubled the monthly transaction limit through e-wallets to Rs 20,000. "All these measures are meant to promote digital
penetration. It will also help farmers in the current rabi season to ensure a normal rabi crop on the back of good monsoon," he said.

Das said: "Public sector banks, some of the private banks and some of the service providers that provide switching services have agreed to waive the service charges on the use of debit cards up to 31 December, 2016."

As of now, Rupay debit cards have already waived the switching charges. Other debit cards that operate through international card network companies like Mastercard and Visa currently charge transaction charges.

"The MDR (merchant discount rate) charges on use of debit cards, the charges being levied by banks and the switching charges will stand completely waived. So, there will be no charge on use of debit cards," he said, adding that banks will make announcement in this regard individually.

With regard to the farm sector, Das said Nabard will disburse Rs 21,000 crore to District Central Cooperative Banks (DCCBs) for onward lending to farmers through Primary Agricultural Cooperative Societies. Over 40 per cent small farmers get crop loans from cooperative institutions.

Updated Date: Nov 23, 2016 17:30 PM

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