credit card debit card payments transactions online payment RBI central government
credit card debit card payments transactions online payment RBI central governmentReuters file

The Delhi High Court on Tuesday issued notices to the Central government and the Reserve Bank of India (RBI) in response to a petition on levying of surcharge on card payments. The respondents have been asked to reply by August 19.

A two-judge bench of Chief Justice G Rohini and Justice Jayant Nath issued notices to the finance ministry and the RBI to file their responses to the petition that also sought directions to "frame guidelines" to stop levying surcharge on card payments, PTI reports.

"The petitioner has noticed that illegal, unequal and arbitrary treatment is seen across the country on transactions being done through credit and debit cards by levying surcharge at the rate of 2.5 percent or more, while such surcharge is not levied when the payment of such transaction is done by making cash payment in that regard," the agency quoted the petition filed by advocate Amit Sahni as saying.

It is worth recalling here that the Narendra Modi government had in February approved withdrawal of the surcharge, service charge and convenience fee on card and digital payments to spur cashless transactions.

"The essential features of the proposals for promotion of payments through cards and digital means include steps for withdrawal of surcharge/ service charge/ convenience fee on card/ digital payments currently imposed by various Government Departments/organisations... [sic]," the finance ministry had said in a statement on Feb. 24, 2016.

While service charge is levied by payment gateways and remitted to the government, convenience charge in the range of 1-2 percent is imposed by retail stores, vendors and merchant establishments on payments made through credit cards.