The Union Cabinet has approved a one-year incentive scheme to promote RuPay debit cards and low-value BHIM-UPI transactions (person-to-merchant, P2M) beginning in April 2022. The approved incentive scheme has a financial outlay of Rs 2,600 crore.
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 (P2M) for FY 2022-23. UPI has achieved a record of 782.9 crore digital payment transactions with a value of Rs 12.8 lakh crore in December 2022. Total digital payments transactions have registered a year-on-year growth of 59%, rising from 5,554 crore in FY2020-21 to 8,840 crore in FY2021-22. BHIM-UPI transactions have registered a year-on-year growth of 106%, rising from 2,233 crore in FY2020-21 to 4,597 crore in FY2021-22.
Various stakeholders in the digital payments systems and the RBI expressed concerns regarding potential adverse impact of the zero MDR regime on the growth of the digital payments ecosystem. Further, the NPCI requested, among other things, for incentivisation of BHIM-UPI and RuPay debit card transactions. This incentive scheme will facilitate building of a robust 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 further deepening of digital payments in the country, across all sectors and segments of the population.
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