I recently booked, through IRCTC app, a berth in second AC coach for 263 km train journey. The Electronic Reservation Slip (ERS) showed total fare (all inclusive) of Rs795.75. Glancing curiously through the payment details given on the ERS, I observed the following break-up of the total fare: ticket fare Rs 760.00* (comprising of taxable value: Rs 720.00 plus 5% IGST: Rs 36.00); IRCTC Convenience Fee (Incl of GST) Rs 35.40; and travel insurance premium (Incl. of GST) Rs 0.35. *Ticket fare was rounded off to Rs 760 from Rs 756, I guess.
However, on perusal I discovered that my account had been debited with Rs 805.14. An unaccounted for amount of Rs 9.39 had been charged extra. I revisited the ERS to scrutinise it minutely for locating the anomaly. A caveat - “PG charges as applicable (Additional)” - was found written in fine print below the row for total fare (all inclusive). PG is an acronym for payment gateway. The notation ‘total fare (all inclusive)’ is misleading if PG charges are to be levied additionally. Moreover, instead of mentioning the specific rate of PG charges, an ambiguous phrase ‘as applicable’ is affixed.
After doing calculation of the extra amount on my own, I arrived at the conclusion that PG charges were 1% of the total fare plus 18% GST thereupon (7.9575+1.4323=9.3898 i.e., 9.39). It appears unjustified to pass on PG charges to the customer after convenience fee has been added to ticket fare. Justification of convenience fee is another debatable point warranting a separate discussion.
In similar fashion, I booked 14.2 Kg LPG cylinder through Indian Oil One App and made the payment digitally in advance on the app. Amount paid (Digital) was Rs 1129.50 as per the invoice. But my account was debited with an excess amount of Rs 8.47 i.e. with Rs 1137.97. Here I didn’t notice on the invoice any notation that PG charges as applicable will be additional. Though the amount is intriguing, I presume it to be PG charges. If single-digit amounts, which are not discerned by us, are deducted extra from multitudes of transactions every day, the collection will be very substantial for beneficiaries.
I accessed ChatGPT for knowledge about PG as follows: “A Payment Gateway is a technology used by merchants to accept debit or credit card purchases from customers. It acts as a middleman between a transaction on an online website and the bank that approves or declines the payment. The gateway securely transmits payment information from the purchaser to the acquiring bank and then returns transaction details and responses from the bank back to the merchant.” The major players in Payment Gateway space are: BillDesk, PayTM, CCAvenue, Razorpay, PayU etc.
PG charges should be borne by the merchant (seller or service provider) rather than the customer. The customer usually only pays the listed price of the product or service they are purchasing. Levying of PG charges in addition to convenience fee from customers is egregious.