Merchant Discount Rates (MDR) structure – unbundling of charges

A composite fee is generally levied on merchants irrespective of the type of card used. In this connection, it is advised that the banks shall:

i)      ensure that MDR are clearly unbundled for different categories of cards;

ii)    enter into separate agreements or annexes within the same agreement for debit, credit and prepaid cards; and

iii)  educate the merchants regarding the charges associated with different categories of cards, at the time of acquisition.

Based on RBI notification dated 1/09/2016. For any further clarification, please refer www.rbi.org.in