Refund charges collected since Jan 1 on electronic payment modes to customers: I-T Dept tells banks

Taking a note of banks levying charges for digital payment modes such as Unified Payments Interface (UPI) and others, the Central Board of Direct Taxes (CBDT) has asked lenders to refund such fees collected from customers since January 1. “… based on Section 10A of the Payment and Settlement Systems Act 2007, any charge including the MDR (merchant discount rate) shall not be applicable on or after 1st January, 2020 on payment made through prescribed electronic modes,” CBDT said in a circular.

“… representations have been received that some banks are imposing and collecting charges on transactions carried out through UPI. A certain number of transactions are allowed free of charge beyond which every transaction bears a charge.