Cashback For Credit Card Users At Petrol Pump Abolished Forever: This Is The Reason Why!
Starting October 1st, credit card users won’t receive any cashback for filling petrol, across India. Credit card users were receiving a cashback of 0.75% for using credit cards at petrol pumps, which will be stopped henceforth.
But what is the reason for this?
No Cash Back For Using Credit Cards At Petrol Pumps
Three state-run Oil Marketing Companies: Indian Oil Corp. Ltd, Bharat Petroleum Corp. Ltd and Hindustan Petroleum Corp. Ltd have told banks to stop giving cashback to credit card users, effective October 1st.
This is the main reason why you will not receive any cashback henceforth at the petrol pumps.
As per the ongoing offer, users were receiving 0.75% of the total amount as cashback offer. This was being credited into the bank account within 3 days.
But now, this offer has expired.
SBI has informed all their customers about this change, by sending them this message:
“…as advised by public sector oil marketing companies (OMCs), the 0.75% cashback on fuel transactions will be discontinued w.e.f. (with effect from) Oct (20)19,”
However, all existing discounts and cashback offers on debit cards, and wallets will continue to operate.
Why This Cashback Was Launched?
Immediately after demonetisation in 2016 end, Govt. had asked all Oil Marketing firms to roll out special cashback offer, to encourage more cashless transactions.
And it worked as well.
Number of digital transactions in India increased from 10% in 2016 to 25% in 2018.
Then Why This Cashback Is Being Stopped?
Because Oil Marketing firms were incurring heavy losses due to the cashback of 0.75%.
Indian Oil Corp. Ltd, Bharat Petroleum Corp. Ltd and Hindustan Petroleum Corp. Ltd, collectively spent Rs 1165 crore on these cashless discounts, and Rs 266 crore was paid to the banks as MDR charges for using credit cards in 2017.
Next year, this amount crossed Rs 2000 crore, and these companies were bleeding red.
In the end, it was decided that the offer of 0.75% discount would be limited to 2.5 years, whose validity end on Oct 1st.
Here are the other cashless based incentives which were announced by Govt., and which helped Indians to adopt cashless and digital transactions.
We will keep you updated, as we receive more updates.