Rail ticket booking row: IRCTC denies barring debit card payment option for several banks
According to a report, Indian Railways online ticketing subsidiary Indian Railway Catering and Tourism Corporation (IRCTC) seemed to be in a tussle with some banks. The report claimed that the rail ticketing portal did not allow some banks' debit cards to book tickets online.
The report claimed that the banks were barred because they refused to share a portion of the convenience fee which they charge customers through the portal.
However, the Ministry of Railways denied the charges. It said that debit cards of all banks were accepted through the seven payment gateways on its website.
DISTRIBUTION OF FEES
Since May, IRCTC and the banks have been trying to come to an accord over the distribution of fees on online booking of rail tickets.
After PM Narendra Modi's demonetisation, IRCTC waived the Rs 20 convenience fee which it charged customers who booked tickets online.
However, it also expected banks to share a part of the convenience fee that they charge customers.
"Every day we are losing 50,000 transactions. Normally, the merchant pays the acquiring bank. But, since IRCTC does not pay us, we were recovering our costs from customers and that is how it had been all these years," a report quoted an SBI official as saying.
MERCHANT DISCOUNT RATE
MDR is the rate charged to a merchant (business/seller) by a bank for providing debit and credit card services.
RBI had earlier lowered MDR charges on payments made through debit cards to 0.25 per cent for payment up to Rs 1,000.
The MDR for debit card payments, including payments made to government, will be capped at 0.25 per cent for transactions up to Rs 1,000 and 0.5 per cent between Rs 1,000 and Rs 2,000, RBI had said.
SERVICE TAX
IRCTC's website presently allows card payments from banks such as Indian Overseas Bank, Canara Bank, United Bank of India, Indian Bank, Central Bank of India, HDFC Bank and Axis Bank.
After demonetisation, Finance Minister Arun Jaitley had announced the withdrawal of service tax on railway tickets booked through IRCTC website. The announcement was made during the Budget 2017 presentation in the Parliament.
