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arpit shukla (,)     16 August 2016

Cash against credit card

Mr. x is having an credit card swaping machine for his professional use and also a current bank account linked with this swaping machine to collect payment from customers.  Customer Y approaches to Mr.X ( Vendor ) with his credit card and request Mr.X to swipe credit card for Rs.10000/-    and in return  Mr. Y ( Customer) request Mr.X to render cash instead product  against credit card by deducting some charges as Mr. Y is in urgent need of cash . Mr. X deducted 2% of swaping amount as charges (i.e Rs. 200/- )  and paid cash of Rs.9800/- Mr.Y instead product .

whether this transaction is authentic and lawful. ..??



Learning

 6 Replies

Kumar Doab (FIN)     16 August 2016

Does not seem to be.

Also relate with T&C of agreement signed with Mechant bank, VISA etc.....

G.L.N. Prasad (Retired employee.)     17 August 2016

Whether it is lawful or not, most of the traders including sister concerns (Cards in the name of individual business man)  are transacting the same way, as they have to maintain smooth relations with in their trade.

The responsibility of the payment is that of card holder. Some business men allow such swipes by taking some additional amount as commission .  If the accepting vendor finds that it is not proper, he can simply reject the offer, as it is not permitted transaction.  Many jewellers wish to dispose their cash in this manner,  as the credit will be given by the bank without sending such cash into the Bank saving manpower, risk and at the same time earning commission unofficially.

It is upto the obliging trader to account for the product.  I have yet to see a business that follows all laws strictly without compromise whether major or minor.

Kishor Mehta (CEO)     17 August 2016

Sir, This is patently illegal. Kishor Mehta

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