Concession given for digital payment at petrol pumps cut to 0.25%
Posted on: 03/Aug/2018 4:31:41 PM
The public sector undertakings for the supply of petrol and diesel have reduced the concession offered for buying petrol and diesel through the digital financial transaction at 0.75%. Now, in the latest announcement, they have reduced this concession from 0.75% to 0.25%.
Following the demonetization in November 2016, there was a huge shortage of cash.
In order to overcome this cash shortage and also reduce all cash transactions in general, during December 2016, the central government announced concessional discounts for those who use credit/debit cards or through digital transactions.
Accordingly, concessions were availed by those who paid through digital transactions for petrol, diesel, insurance coverage, railway catering, and tollgate payments, etc.
In this system, a 0.75% ‘cashback ‘ offer was given for the purchase of every litre of petrol and diesel. This concession was credited to the bank savings account of the buyer after the digital transaction.
For example, if the price of petrol is assumed to be Rs. 80 per litre, 0.75% of this amount, which is 60 Paise will be paid back to the buyer. However, the public sector oil corporations have now announced that the cashback offer is being reduced from the existing 0.75% to 0.25%.
As per the above example, the buyer will now get a cashback of just 20 Paise per litre of petrol. This new system has been implemented from 1st August.
The oil corporations have sent SMS to all dealers of petrol and diesel to inform the customers.
Insurance policy premium payment
Subsequently, it is suspected whether the same ‘cashback’ offer reduction would be announced in other avenues such as life and general insurance premium payments and train ticket booking. Presently, a cashback offer of 8% is available for the digital transaction on insurance premium payments. For general insurance, this concession is up to 10%. As the smartphone usage for payments has shown an increasing trend, there is a considerable growth in the digital transactions.
However, as the cash availability has returned to the pre-demonetisation level, there is an increase in cash transactions as well.
Railways and Tollgate
In the digital transaction conducted for railway-related avenues such as buying monthly/quarterly season tickets, 0.5% concession is available. A discount of 5% is available for using railway waiting rooms/food orders, etc.
In tollgates, for those who pay through pre-paid cards or digital transactions, a 10% concession is given.
Those who transact through the ‘Bhim’ App or UPI, a maximum concession of up to Rs. 750 per month is given. The traders get concessions up to Rs. 1000.
