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Merchant Discount Rate

With reference to the Merchant Discount Rate (MDR), consider the following statements:

  1. MDR is a fee charged from a merchant by a bank for accepting payments from customers through credit and debit cards in their establishments.
  2. MDR compensates the card issuing bank, the lender which puts the PoS terminal and payment gateways such as Mastercard or Visa for their services.
  3. MDR charges are usually shared in pre-agreed proportion between the bank and a merchant and is expressed in percentage of transaction amount.

Choose the correct answer from the codes given below:

A
1 and 2
B
2 and 3
C
1 and 3
D
1, 2 and 3