Delhi High Court directs RBI to broker PayU, banks and Visa fee dispute

In a September 14 order, the Delhi High Court asked the Reserve Bank of India to assign a senior payments specialist to mediate a dispute among PayU Payments, Yes Bank, ICICI Bank and Visa over merchant classification and related interchange fee claims. Justice Subramonium Prasad gave the mediator 30 days to seek a resolution and ordered the status quo to be maintained on past transactions, preventing Visa from issuing final fee determinations and stopping acquiring banks from further deductions from PayU.

The conflict arises from alleged incorrect Merchant Category Codes, which ICICI Bank says led to lower fees, while PayU argues it only supplies merchant information and does not assign the codes. Yes Bank has already reversed deductions exceeding Rs 5.95 crore, but Rs 6.88 crore remains withheld, and PayU fears additional deductions from other banks. The court emphasized the RBI’s regulatory role in the payments ecosystem as the basis for its involvement.