Fuel retailers seek exemption from mandatory MDR rules

Petroleum retailers have formally opposed the implementation of mandatory Merchant Discount Rate (MDR) levies on fuel sales, requesting that the government grant them exemption from digital payment regulations that apply to other retail sectors.

The dealers argue that fuel is an essential commodity with razor-thin profit margins, and that imposing MDR charges on digital transactions would further compress their already limited earnings. According to industry representatives, the additional costs would be passed on to consumers or absorbed by retailers with limited capacity to absorb losses.

The petition comes as regulatory authorities push for greater digitalization of payments across all commercial transactions. Petroleum dealers contend their business model differs significantly from other retail sectors, as fuel sales operate under a controlled pricing mechanism with limited flexibility in pricing adjustments.

Industry bodies representing fuel retailers have urged policymakers to consider sector-specific exemptions or alternative arrangements that would encourage digital payments without imposing additional financial burdens. The issue remains under review by government authorities responsible for both petroleum regulation and payment system policy.