Petroleum dealers, banks remain at odds over merchant charges

KARACHI: A number of fuelling stations in the country are not accepting credit, debit, or privilege cards as petroleum dealers and banks remain at odds over merchant charges, it was reported on Monday.
A source told The Express Tribune that the profit margin of pump owners is lower compared to cash transactions since banks are collecting merchant charges of Rs 1.60 to Rs 1.75 per litre of petrol from petroleum dealers who allow the use of credit and debit cards at their stations.
“When gas prices were lower and pump sales were higher, the relevant oil marketing corporations used to cover half of the merchant charges levied by petrol dealers for transactions made with credit and debit cards, but things have changed now,” said Shoaib Khanji, a petroleum dealer. He further added that petroleum product prices have increased resulting in lower sales volumes and higher business costs for dealers. Khanji also said oil marketing companies no longer agree to cover half of the merchant charges.
“Owners of petrol pumps do not take credit, debit, or privilege cards because petroleum dealers are having trouble covering merchant fees with their low rate of profit,” he further added and said the State Bank of Pakistan needs to step in to resolve the issue.
“In this case, the State Bank should step in and establish a process between banks and fuel dealers and standardize the sale of fuel using credit and debit cards to advance digital payments in the country.
This will help the economy,” said Khanji. Chairman of Pakistan Petroleum Dealers Association Abdul Sami Khan told The Express Tribune that they are negotiating with Pakistan State Oil (PSO) authorities to recoup their share of merchant charges.
“Owners of petrol pumps do not take credit, debit, or privilege cards because petroleum dealers are having trouble covering merchant fees with their low rate of profit,” he further added and said the State Bank of Pakistan needs to step in to resolve the issue.-PNP