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Challenges to digital payments: TRAI Chief (Relevant for GS Prelims, GS Mains Paper III)

Issues in digital transactions

1. Referring to the merchant discount rate (MDR) levied on transactions done through credit and debit cards, Mr.Sharma said there is no relationship between the charges and the ‘work done’ to justify them. “The work at the back-end is almost zero… You are just making some entry into some database that Mr.X transferred some amount to Mr Y. That’s only an entry. No work’s being done.

2. Building confidence : The TRAI chief said it is important to build confidence in the systems and ensure that all relevant software is tested for cyber-security and other security risks.



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