Cabinet clears Rs 1,300-cr scheme to promote RuPay, BHIM transactions

The Cabinet connected Wednesday approved a Rs 1,300-crore inducement strategy to beforehand RuPay debit cards and boost low-value transactions done the BHIM unified payments interface (UPI) exertion for 1 twelvemonth starting April 2022.

The thought is to alteration a immense fig of people, particularly successful the marginalised sections of nine who are extracurricular the ceremonial banking network, to follow the integer outgo system.

Briefing astir the Cabinet decisions, electronics and IT curate Ashwini Vaishnaw said the authorities volition reimburse transaction charges levied connected integer payments made by persons to the merchant (P2M), arsenic portion of the merchant discount complaint (MDR).

The authorities volition wage a percent of the worth of the person-to-merchant (P2M) transactions done done RuPay debit cards and low-value BHIM-UPI modes of payments.

A sustained propulsion by the authorities and the emergence of respective payments intermediaries person driven up integer transactions successful the state successful caller years. The fig of integer payments jumped from 1,459 crore successful FY18 to 4,371 crore successful the past fiscal. In November, the fig of transactions connected the UPI level remained precocious astatine 418 crore, involving an magnitude of Rs 7.68 lakh crore.

Starting January 1, 2020, the authorities scrapped MDR for each RuPay and UPI transactions, though banks are allowed to enforce the outgo utilizing different paper outgo networks. Several stakeholders successful the integer payments manufacture person been seeking a restoration of the MDR rates.

The Cabinet determination comes up of a program by the cardinal slope to interval a treatment insubstantial connected integer outgo charges wrong a month. Announcing the monetary argumentation connection past week, Reserve Bank of India (RBI) politician Shaktikanta Das said the insubstantial is aimed astatine ensuring that integer outgo charges stay affordable to users and economically remunerative to providers.

“There have, however, been immoderate concerns connected the reasonableness of assorted charges incurred by customers for integer payments done recognition cards, debit cards, prepaid outgo instruments (cards and wallets), Unified Payments Interface (UPI) and the like. It is projected to merchandise a treatment insubstantial connected assorted charges successful the outgo strategy to person a holistic presumption of the issues progressive and imaginable approaches to mitigating the concerns truthful arsenic to marque integer transactions much affordable,” Das said.