Chandigarh, Sept 21: Fuel pump operators in Punjab have resolved to discontinue UPI payment acceptance for amounts over Rs 2,000 beginning October 16. The collective decision, voiced by the Petrol Pump Dealers’ Association Punjab (PPDAP), stems from opposition to the 0.4 per cent Merchant Discount Rate (MDR) set to apply to larger person-to-merchant transactions.
Under a September 14 notification from the Ministry of Finance, merchant-side MDR fees capped at Rs 300 are scheduled to take effect from October 15 for UPI payments above the Rs 2,000 threshold. Retail fuel vendors maintain that the extra fee structure severely undermines the viability of petroleum outlets operating on tight fixed commissions.
The PPDAP has written to the Ministry of Petroleum and Natural Gas, the Finance Ministry, and state-run oil marketing companies seeking an explicit exemption for petrol pumps. Association representatives maintained that while the government determines electronic payment regulations, retail fuel operators require policy protection to remain operational.
“Fuel stations in Punjab earn a margin of just 2 per cent on every litre of petrol, which is already less to manage operational costs such as electricity bills, staff salaries, maintenance and other expenses, leaving little room to absorb the additional transaction cost,” asserted Paramjit Singh Doaba, state president of the association. He affirmed that with up to 40 per cent of daily customers opting for digital payments over Rs 2,000, absorbing the charge is unviable. “We have requested the Centre and oil companies to exempt fuel stations from the charges. Otherwise, we will have no option but to stop accepting such UPI payments,” he maintained.
Clarifying alternative arrangements, Manjeet Singh, state secretary of the association, stated that debit and credit card transactions would continue uninterrupted, as card payment structures manage MDR burdens through existing commercial mechanisms.
The impending restriction has drawn concern from commercial transport leaders. Sharanjit Singh Kalsi, state president of the Youth Azad Taxi Union, declared that taxi drivers frequently incur single-trip fuel charges between Rs 20,000 and Rs 30,000. He maintained that expecting operators without credit cards to carry heavy cash sums presents serious security and practical issues, urging authorities to resolve the levy impasse quickly.
