Starting from Monday, January 9, petrol pumps across Karnataka will stop accepting debit and credit cards payments. The new decision follows the sudden move by banks to charge one percent transaction fee for every payment made by card.
Petrol pumps have said it will be all-cash payments until the banks withdraw the transaction charge. "They (banks) must apologise to the public," BR Ravindranath, president, Akhila Karntaka Federation of petroleum traders and Bangalore Petroleum Dealers Association was quoted as saying by the Times of India.
The latest announcement will not target the citizens directly as the charges will not be borne by the customers who use cards. "If the banks straight away levy a one percent transaction fee, where do they expect us to go. It becomes extremely difficult to survive in such circumstances," Ravindranath further stated.
Oil Marketing Companies (OMCs) determine the profits of all petroleum dealers.
The petrol pump dealers' decision to not accept card payments comes at a time when the central government is pushing for digital payments. The new rule is bound to bring inconvenience to lakhs of vehicle owners due to the current note crunch.
Commenting on the move, a manager at a petrol station said: "The public will see us as the villains now. They will think we are inconveniencing them by demanding only cash, but the truth is not that. Sale of petrol/diesel is highly regulated and we cannot fix our own rates in view of this sudden levy by banks. So our best option is to not accept cards."