SALIENT FEATURES OF MERCHANT BANKING
How it works
Merchant customers after selecting the type of POS machine of their choice, they have to select the mode of payment for the purpose of procurement of the machine. There are two types of payment systems for procurement of machines.
(i) One Time Cost & Monthly Rentals
(ii) Monthly Commercials Charges
(iii) Free POS machine
(iv) Monthly service charges
New Android POS MACHINES
An Android point of sale (POS) system is essentially a wireless, portable cash register for smartphones and tablets with an Android Operating System. An Android mPOS eliminates the need for a clunky cash register and can carry out all of the functions of a traditional POS terminal plus more.
Benefits to Bank
- Moving fast towards Digital India.
- New Current Accounts will be opened in the Bank by Merchants.
- New Customer Acquisition: Increased transactions lead to more references for new accounts, which will generate more business for the Banks in the long run.
- Reduced attrition of Customers.
- Banks can utilize the Merchant float.
- Continuous flow of funds in accounts helps in increasing the CASA balance of Banks.
- 2% discount benefit on GST as per the announcement from the Government of India.
- Visibility at Merchant locations leads to marketing for the Banks.
Procurement Cost for Android Type
There are 3 types of payment mode for procurement cost of machine under GPRS type, which are as under.
Customers have to select any one mode of payment and request the branch through a letter specifically for this purpose.
(a) One Time Cost & Monthly Rentals
If the Customer wants to purchase the machine by investing one time cost at the beginning and to avail the benefit of low monthly rental payment can opt this type of payment for procurement of Android pos machine.
|One Time Cost||Rs. 11000 + Service Tax|
|Installation Charges||Rs. 1500 + S.T.|
|QR Code on Same device (one time) Non Refundable||Rs. 1000 + S.T|
|Monthly Rent||Rs. 300 + S.T|
(b) Monthly Commercial Charges
If the customer wants to maintain a large amount in his Current account, he can opt for this type of payment for procurement of machines since it has no one time cost & installation charges and monthly rental charges are in reduced slabs as mentioned here below.
Current Account Balance
|Rs. 25000 – 50000/-||Rs. 500 + ST|
|Rs. 50001 – 75000/-||Rs.400 + ST|
|Rs. 75001 – 100000/-||Rs. 300 + S.T|
|Above Rs. 100000/-||NILL|
(c) Free POS machine
If he maintains an One lakh average amount in his celebration Current account, he can get a free pos machine for procurement but if he wants QR Code on Same device he has to pay 1000 + GST (one time) Non Refundable.
(d) Monthly service charges
If the customer maintains an fifty thousand average amount in his freedom Current account, he can get a free pos machine and he has to pay monthly service charges. If he wants QR Code on Same device he has to pay 1000 + GST (one time) Non Refundable.
Important Points for Merchants
- Settle / Close the transaction batch every day before 10.30 pm to avoid delay in receiving payments.
- Keep Receipts/Charge slip for Thirteen months from the transaction date to avoid Chargeback.
MDR: Below table shows the percentage of Transaction Value that the Merchant needs to pay to the Acquirer Bank.
|No||Parameter||% of Transaction Value|
|1||Debit card transaction||
|2||Consumer Credit Card||1.40%|
|3||Premium Credit Card||2%|
|4||Super Premium Credit Card||2.50%|
|Issues||Name of the Officials||Cell Number|
|Any other Clarifications about the product & Operational issues||Mr. Devaraj, Merchant Banking Dept. at HO||99016 32050|