BANKING AFFAIRS

Detailed explanation-1: -A merchant discount rate, or MDR, is a rate charged to a merchant for the payment processing of debit and credit card transactions. The merchant discount rate is also referred to as the transaction discount rate (TDR). MDR is given as a percentage of each sales transaction processed.

Detailed explanation-2: -Merchant Discount Rate (MDR 9): This is the charge recovered by the acquirer from the final recipient of money (i.e., merchant). It is levied as a discount to the transaction amount and usually recovered during settlement of the payment transaction (Box 2).

Detailed explanation-3: -This fee is called Merchant Discount Rate (MDR). The MDR varies depending on the payment method used. For e.g., the MDR for debit cards is capped between 0.3-0.9% depending on the merchant’s turnover and the payment channel. There is no cap on MDR for credit cards and PPIs.

Detailed explanation-4: -MDR is the rate or amount that a merchant pays for using a lender’s credit card or debit card services for accepting their customers’ bills. Presently, only Rupay-based debit cards and UPI do not attract any MDR charge.

Detailed explanation-5: -MDR is charged to the merchants for accepting digital payments. While UPI payments are currently exempted from MDR, credit cards attract the highest MDR between 1%-2% of the total transaction amount.