From The Economic Times · Joel Rebello · · 50s
SBI to earn surplus from UPI MDR charges
SBI expects to generate surplus revenue from new UPI transaction fees starting October 15.
In brief
SBI expects to generate surplus revenue from new UPI transaction fees starting October 15. SBI anticipates surplus revenue from 0.4% merchant discount rate on UPI payments over Rs 2,000 starting October 15. Originally reported by The Economic Times.
New UPI fee rule
SBI will charge 0.4% merchant discount rate on UPI payments over rs 2000.
“Naturally as one of the largest card issuing banks we will get 40 basis points of the value”
SBI's revenue plan
SBI expects surplus from its large payment network and app services.
“We also have a payment system and an application services so it is fair to assume that we will make some money”
Fee split details
Issuing bank gets 0.40%, acquiring bank 0.30%, gateways 0.20%, apps 0.10%.
“Since we are both a large acquiring and issuing bank we will automatically get a large chunk of the amount”
SBI's concerns
SBI worries about transaction splitting and system pressure.
“There are also reports that people will split the transactions to avoid charges”
SBI's financial strength
SBI has $10 billion from fcnr (b) inflows and rs 5.5 lakh crore deposits.
“We annually garner rs 5.5 lakh crore from normal deposits which we comfortably deploy”
What happens next
SBI will evaluate MDR impact on smaller banks and systems.
“We have to evaluate all those aspects”
What to remember
SBI anticipates surplus revenue from 0.4% merchant discount rate on UPI payments over Rs 2,000 starting October 15.
