Merchant Discount Rate (MDR)

The Merchant Discount Rate is the percentage fee charged to merchants by their acquiring bank for processing card transactions, capped in India by the RBI.

What Merchant Discount Rate (MDR) means in credit cards

Merchant Discount Rate (MDR) is one of the standard terms that banks, card-issuers, and payment networks use in credit card disclosures, fee schedules, and product-comparison pages in India. When a bank or card-issuer publishes a credit card's terms and conditions, the bank uses terms like Merchant Discount Rate (MDR) to describe benefits, eligibility, billing, and operational mechanics.

Cardholders will see Merchant Discount Rate (MDR) referenced on the issuer's product page, in the monthly credit card statement, in dispute-resolution correspondence, and in the bank's customer-service knowledge base. Tracking the term helps the cardholder decode the fee schedule and understand what triggers a charge.

The Reserve Bank of India's 2021-22 master directions on credit cards and digital lending also use terms like Merchant Discount Rate (MDR) in the regulatory framework that every card-issuer in India has to follow. FinWiz24's glossary collects these terms so readers can look them up without combing through a 40-page card-issuer T&C document.

Related terms

• acquirer-bank
• acquiring-bank
• add-on-card
• authorisation
• authorised-user

Frequently asked questions

Where can I check the exact definition of Merchant Discount Rate (MDR) for my card?

Your card-issuer's most recent credit card terms and conditions document (usually linked from the product page) is the authoritative source. The issuer's customer-service team can also clarify how the term applies to your specific card variant.

How does Merchant Discount Rate (MDR) affect the fees I pay on my credit card?

Most credit-card terms either describe a benefit you can use (and therefore value) or a fee that the issuer charges when a specific action triggers the term. Read the related fee schedule side-by-side with the term's definition to understand the financial impact on your monthly statement.

What other terms should I read alongside Merchant Discount Rate (MDR)?

The FinWiz24 glossary lists every credit-card term the editorial team tracks. Search for a related term above, or browse the A-Z glossary index for the full vocabulary.