Discount on digital payments in petrol pumps to reduce to 0.25% from 0.75% effective from August 1 2018. State owned oil companies informed the petrol pump operators about this reduction via text message.
‘Dear Business Partner, Kindly note and inform your all customers that Digital Cashback has been revised from 0.75 per cent to 0.25 per cent with effect from August 1, 2018 across oil industry for all loyalty customers,’ it said.
Effects of discounts on fuel prices
Shortly after demonetization the government announced a 0.75% discount on digital payments at petrol pumps to support digital transactions. And customers making digital payments received cash back in their account within 3 days. With 0.75% discount, consumers profited by 57p per liter on petrol and 50p per liter on diesel. However with 0.25% discount, customers will profit only 19p per liter on petrol and 17p per liter on diesel.
This has been calculated based on the petrol and diesel prices prevailing now in Delhi. The price of petrol is ₹76.43/liter and the price of diesel is ₹67.93/liter. When this discount was initially introduced about 4.5 cr consumers purchased petrol/diesel worth 1800 cr on a daily basis. Digital payments almost doubled to 40% at that time.
Other discounts on digital payments
The government announced several discount schemes to support digital payment after demonetization in 2016. A 0.5% discount on monthly and seasonal suburban railway ticket was introduced in January last year. A 10% discount on National Highway toll payments via cashless transactions was also bought in.
The government also announced that it will bear the MDR (Merchant Discount Rate) costs for debit card transactions up to ₹2000 from January this year for a period of 2 year.
Similar rate cuts are expected for other discounts too that went into effect after demonetization.