The Union Cabinet on January 11 gave its nod to a Rs 2,600 crore-incentive scheme, which is aimed at boosting low-value transactions done through Unified Payments Interface (UPI) and promote Rupay debit cards.
The scheme, with a total financial outlay of Rs 2,600 crore, has been approved for financial year 2022-23, the government said in a press briefing. The incentives will be provided on the use of Rupay debit cards and the person-to-merchant BHIM-UPI transactions of low value, Union Minister Bhupendra Yadav told reporters.
Under the scheme, "the acquiring banks will be provided financial incentive for promoting point-of-sale (PoS) and e-commerce transactions for current FY2022-23", a release issued by the government stated.
The benefits of the scheme includes the "building of a robust digital payment ecosystem", and to "promote UPI Lite and UPI 123Pay as economical and user-friendly digital payment options", it added.
Also Read | UPI clocks 19.65 billion transactions at Rs 32.5 trillion in Q3 2022: Report
According to the government, the National Payments Corporation of India (NPCI) -- the nodal body for digital payments and settlement systems - had requested "for incentivisation of BHIM-UPI and RuPay Debit Card transactions to create a cost-effective value proposition for ecosystem stakeholders, increase merchant acceptance footprints and faster migration from cash payments to digital payments".
The scheme is also in line with Finance Minister Nirmala Sitharaman's announcement in her last Budget speech, reiterating the government's intent to "continue the financial support for digital payments", the release added.
ALSO READ: Why has RuPay rattled Visa and MasterCard?
Digital payment transactions continue to gain momentum in the country, with the UPI achieving a record of 782.9 crore digital payment transactions with a value of Rs 12.82 lakh crore in the month of December 2022, the government pointed out.
Total digital payments transactions have registered a year-on-year growth of 59 percent, rising from 5,554 crore in FY2020-21 to 8,840 crore in FY2021-22, it further said, adding that BHIM-UPI transactions have registered a year-on-year growth of 106 percent, rising from 2,233 crore in FY2020-21 to 4,597 crore in FY2021-22.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
