The Union Cabinet, led by Prime Minister Mr. Narendra Modi, authorised an incentive programme to promote RuPayDebit cards and low-value (upto Rs. 2,000 [US$ 26.17]) BHIM-UPI transactions (Person-to-Merchant (P2M)] BHIM-UPI transactions across India.
The government would incentivize acquiring banks under the programme by paying a proportion of the value of transactions person-to-merchant (P2M) made using RuPay Debit cards and low-value BHIM-UPI forms of payments, with an expected financial investment of Rs.1,300 crore (US$ 170 million) for a one-year period beginning April 1, 2021.
This plan will assist acquiring banks in developing a robust digital payment ecosystem and promoting RuPay Debit card and BHIM-UPI digital transactions across all sectors and segments of the population, as well as advancing the country’s digital payments.
It would also assist in making digital means of payment available to unbanked and underprivileged people who are not part of the conventional banking and financial system.
The plan would encourage more fintech research and development, as well as assist the government in strengthening digital payments in various parts of the country.
Background:
The scheme has been formulated in compliance with the Budget announcements (FY 2021-22) by the Government to give an added boost to digital transactions in India.
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