Fuel stations in Punjab have announced that they will not accept UPI payments above Rs 2,000 from October 16, opposing the proposed 0.4 per cent Merchant Discount Rate (MDR) on such high-value transactions.The Petrol Pump Dealers’ Association Punjab (PPDAP), representing more than 4,000 dealers in the state, has urged the Centre and oil marketing companies to exempt petroleum retail outlets from the proposed charges. The association said dealers were already struggling with thin margins and could not absorb any additional digital transaction costs.In a letter to the Union Ministry of Petroleum and Natural Gas and the Ministry of Finance, as well as the chairpersons and managing directors of oil marketing companies, the association said while the policy, structure, rate and applicability of MDR charges were matters for the government and regulatory authorities to decide, the petroleum retail sector must be protected from any adverse impact.According to a gazette notification released by the Ministry of Finance on September 14, under the proposed framework, person to merchant (P2M) UPI transactions above Rs 2,000 would attract an MDR of 0.4 per cent capped at Rs 300 per transaction from October 15. The charge would be levied on the merchants.Paramjit Singh Doaba, state president of the association said, “Fuel stations in Punjab earn a margin of just 2 per cent on every litre of petrol, which is already less to manage operational costs such as electricity bills, staff salaries, maintenance and other expenses, leaving little room to absorb the additional transaction cost.”He said around 30 to 40 per cent of their customers made UPI payments above Rs 2,000 every day, which could lead to a significant additional financial burden on dealers.“We have requested the Centre and oil companies to exempt fuel stations from the charges. Otherwise, we will have no option but to stop accepting such UPI payments,” Doaba said.Manjeet Singh, state secretary of the association said, “Fuel stations would continue accepting digital payments through credit and debit cards, as the MDR on those transactions is borne through the existing card payment companies.”The proposed change, if implemented without an exemption, could also create difficulties for customers who routinely make high-value fuel payments including commercial vehicle owners, small bus operators and truck operators.Youth Azad Taxi Union state president Sharanjit Singh Kalsi said customers booking taxis for long-distance journeys often had to pay fuel expenses ranging from Rs 20,000 to Rs 30,000 per trip. “Customers who have credit cards may not face any issue, but those without them cannot be expected to carry such large amounts of cash. This could cause severe inconvenience,” he said.