The Union Cabinet on Wednesday approved an incentive scheme worth ₹1,300 crore for the promotion of RuPay Debit Cards and low-value (upto ₹2,000) BHIM-UPI transactions (person-to-merchants) in the country.
Under the scheme, the acquiring banks will be incentivised by the government by way of paying percentage of value of transactions (P2M) done through RuPay Debit cards and low-value BHIM-UPI modes of payments, at an estimated financial outlay of ₹1,300 crore for a period of one year, with effect from April 1, 2021.
The scheme has been formulated in compliance with the Budget announcements (FY2021-22) by the government to give further boost to digital transactions in the country.
“Government will invest ₹1,300 crore so that more Indians can move into the digital fold through BHIM-UPI and RuPay Debit cards,” Ashwini Vaishnaw, Union Minister of Railways, Communications and Electronics & Information Technology told reporters after a Cabinet meeting.
Record transactions
In November this year, India saw record number of digital transactions at 423 crore valued at ₹7.56 lakh crore (nearly $100 billion), Vaishnaw said.
This is the level of digital payments that India has accepted and today’s Cabinet decision will further accelerate the adoption, he added.
This scheme will facilitate acquiring banks in building robust digital payment ecosystem and promoting RuPay Debit card and BHIM-UPI digital transactions across all sectors and segments of the population and in further deepening of digital payments in the country.
It will also help in making accessible digital modes of payments to unbanked and marginalised populations, who are outside of the formal banking and financial system.
