Petrol pump operators across Tamil Nadu have threatened to stop accepting UPI and other digital payments, raising concerns over bank account freezes and police action triggered by transactions later linked to cybercrime complaints.
The Tamil Nadu Petroleum Dealers Association (TNPDA), which represents around 5,000 fuel outlets in the state, has sought the intervention of Chief Minister C. Joseph Vijay, warning that the growing risks associated with digital transactions are making it increasingly difficult for dealers to continue offering cashless payment facilities.
In a letter to the Chief Minister, TNPDA president K.P. Murali said fuel dealers were being drawn into cybercrime investigations even though they had no role in the transactions beyond receiving legitimate payments from customers purchasing petrol or diesel.
According to the association, petrol pumps have no mechanism to verify the identity of every customer making a digital payment or determine whether money transferred through UPI or other platforms has previously passed through an account connected to an alleged cyber fraud.
Digital payments have become a major component of fuel retail transactions in Tamil Nadu. An average petrol station processes between 200 and 500 digital payments every day, while at some outlets UPI and other cashless transactions account for more than half of the total revenue.
The association said the problem arises when a payment received by a petrol pump is subsequently flagged during a cybercrime investigation.
Banks, acting on instructions from investigating authorities, may place a lien on the amount involved or, in some instances, freeze the dealer’s entire bank account. Dealers argue that freezing operational accounts over individual disputed transactions can severely disrupt businesses that handle large volumes of payments every day.
Fuel outlets depend on uninterrupted banking operations to purchase fuel, pay employees and meet other routine expenses.
The TNPDA has also expressed concern over police action against dealers in connection with such transactions. It alleged that there have been instances in which petrol pump operators were taken for questioning during early morning hours without initially being provided clear details about the disputed payment being investigated.
The association maintained that fuel dealers should not be treated as suspects merely for accepting payments through authorised digital channels.
It has urged the Tamil Nadu government to establish safeguards ensuring that legitimate merchants are not subjected to sweeping account freezes or coercive police action over transactions beyond their control.
The dealers warned that unless a workable mechanism is introduced, petrol pumps across the state may be forced to discontinue UPI and other digital payment facilities and revert to cash-based transactions.
