Seller Illegally Charging MDR Fee on Debit Card Payment — Consumer Rights and Legal Remedies

Rohan Gupta, a resident of Gomti Nagar, Lucknow, visited a local electronics retailer in early March 2025 to buy a home appliance. He paid using his HDFC Bank debit card. At billing, the shopkeeper added a 2% MDR (Merchant Discount Rate) surcharge, claiming it covered the "card processing cost." Rohan objected on the spot. A heated argument followed, but the seller wouldn't budge. Rohan paid under protest and decided to take this further.

He first sent a complaint email to the RBI grievance portal, then followed up with a written complaint to the National Payments Corporation of India (NPCI). Weeks passed. Nothing came back. Frustrated, he tried a consumer helpline — again, no luck. It was only after he approached Advocate Sudhir Rao, who has handled a significant number of consumer protection and digital payment disputes, that the matter was structured properly and pursued through the right forum.

A formal consumer complaint was filed before the District Consumer Disputes Redressal Commission in Lucknow under the Consumer Protection Act, 2019, supported by the bill, bank statement, and RBI circular clearly prohibiting MDR surcharging on debit card transactions. The seller was served notice. Faced with clear documentary evidence and a well-grounded legal approach, the opposite party opted for a settlement, refunding the surcharge along with a compensation amount. Rohan's persistence, combined with proper legal framing the second time around, made all the difference.

You can read about this case in detail at https://sudhirrao.com/seller-charging-mdr-fee-debit-card-consumer-rights-legal-rem/