New Delhi: In a move that may boost digital payments, businesses with an annual turnover of more than ₹50 crore will have to mandatorily offer electronic mode of payments to their customers from 1 November, the finance ministry said on Friday.
Besides, no charges or merchant discount rate (MDR) — charge that payment systems and banks impose on commercial transactions– will be levied on either customers or merchants.
Towards this, Central Board of Direct Taxes (CBDT) has invited banks and authorise payments system providers send an application, citing that they are “willing that their payment system can be taken into consideration”, it said in a statement.
Payments via digital modes will make transactions for mid- and large-sized businesses more transparent and thereby prevent tax evasion.
Towards faster adoption of digital payments, finance minister Nirmala Sitharaman in the Union Budget said that business establishments with annual turnover of more than ₹50 crore will have to offer low cost digital modes payments to customers and not impose charges or MDR on customers and merchants.
In her Budget speech, Finance Minister Nirmala Sitharaman had said business establishments with annual turnover of more than 50 crore should offer low cost digital modes of payment to their customers and the RBI and banks should absorb cost of transactions.