To promote BHIM-UPI and RuPay, the centre approves a Rs 2,600 billion project
By siliconindia | Thursday, January 12, 2023
The Union Cabinet has also approved the incentive programme for promotion of RuPay Debit Cards and low-value BHIM-UPI transactions (person-to-merchant) for a period of one year from April 2022. The scheme has a financial outlay of 2,600 crore, announced Union Minister Bhupender Yadav. Under the scheme, acquiring banks will be provided financial incentive for promoting Point-of-sale (PoS) and e-commerce transactions using RuPay Debit Cards and low-value BHIM-UPI transactions.
Finance Minister Nirmala Sitharaman, in her Budget speech 2022-23, had announced government’s intent to continue the financial support for digital payments announced in the previous Budget, with a focus on promoting use of payment platforms that are economical and user-friendly.
In 2021-22, the government had approved an incentive scheme in compliance with the budget announcement to boost digital transactions. As a result, the government says, total digital payments transactions have registered a year-on-year growth of 59%, from Rs 5,554 crore in 2020-21 to 8,840 crore in 2021-22. BHIM-UPI transactions have registered a growth of 106%, rising from Rs 2,233 crore in Rs 4,597 crore.
Various stakeholder in the digital payments systems and the Reserve Bank of India (RBI) expressed concerns regarding potential adverse impact of the zero MDR regime on the growth of the digital payments ecosystem. Further, the National Payments Corporation of India (NPCI) requested, among other things, for incentivisation of BHIM-UPI and RuPay Debit Card transactions to create a cost-effective value proposition for stakeholders, the government said in a statement on Wednesday.
The government says it is taking various initiatives for promotion of digital payments across the country. During Covid-19, digital payments facilitated functioning of businesses, including small merchants, and helped in maintaining social distancing.
This incentive scheme will facilitate building of a digital payment ecosystem and promoting RuPay Debit Card and BHIM-UPI digital transactions. The scheme will also promote UPI Lite and UPI 123PAY as economical and user-friendly digital payments solutions and enable penetration of digital payments across all sectors and segments of the population, the government said.
Besides, in principle approval was also given for renaming Kolkata-based The National Centre for Drinking Water, Sanitation & Quality as Dr Syama Prasad Mukherjee National Institute of Drinking Water and Sanitation, Yadav said.
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