Petrol pump operators could stop accepting UPI payments above ₹2,000 if a Merchant Discount Rate (MDR) is imposed on such transactions, traders’ organisation Chamber of Trade and Industry (CTI) has warned. The organisation said most fuel purchases at petrol stations already exceed the ₹2,000 mark, meaning an additional payment charge could put further pressure on operators working with tight margins.
CTI Chairman Brijesh Goyal said several petrol pump operators had raised concerns about the MDR already being charged on credit card transactions. According to him, extending a similar charge to UPI payments could increase the financial burden on fuel retailers and affect their earnings.
Why ₹2,000 UPI Payments Are a Concern for Petrol Pumps
Goyal said a typical petrol purchase for a car can amount to around ₹3,000 to ₹5,000, while diesel purchases for trucks can cross ₹10,000. This means a significant number of transactions at petrol pumps could fall above the proposed ₹2,000 threshold.
He said petrol pump operators generally work with a margin of around ₹3-4 per litre. If they are required to bear an MDR of 1% on UPI transactions, the additional expense could further reduce their margins and potentially result in losses.
The concern has emerged as traders continue to oppose any proposal to impose additional charges on higher-value UPI payments.
Petrol Pumps Could Restrict UPI Above ₹2,000
According to Goyal, petrol pump associations have told CTI that operators are already dealing with an MDR of around 0.8% to 1% on credit card transactions. They fear that introducing a similar charge for UPI payments could make digital transactions more expensive for fuel retailers.
Goyal said some operators could therefore be forced to stop accepting UPI payments above ₹2,000. CTI said petrol stations could even display notices informing customers that UPI payments above the specified amount would not be accepted.
Such restrictions could create difficulties for customers who increasingly depend on digital payment methods for everyday purchases, including fuel.
Traders Warn of Impact on Consumers
CTI General Secretaries Gurmeet Arora and Ramesh Ahuja said UPI payments above ₹2,000 should not attract any additional charge. They pointed out that while the government may maintain that the MDR would be collected from merchants rather than customers, businesses could eventually try to recover the additional cost from consumers.
The organisation has therefore opposed the proposed MDR on higher-value UPI transactions, arguing that the additional financial pressure could affect both traders and customers.
CTI also highlighted the widespread use of UPI across Delhi’s markets, where digital payments have become an important part of daily business transactions.
Over 70% of Delhi Traders Accept UPI, Says CTI
According to CTI, more than 70% of traders in several major Delhi markets accept UPI payments. These include Chandni Chowk, Kashmiri Gate, Sadar Bazaar, Kamla Nagar, Lajpat Nagar, Chawri Bazaar, Connaught Place, Karol Bagh, Gandhi Nagar, Sarojini Nagar and Rajouri Garden.
The traders’ body has called for both UPI and RuPay payments to remain completely free of MDR. CTI Chairman Brijesh Goyal also said the organisation would launch a protest if such charges are imposed on traders.
The issue has raised concerns among fuel retailers and traders over how additional digital payment costs could affect businesses and consumers, particularly for transactions that naturally involve amounts above ₹2,000.