₹2,600 crore incentive to promote digital payments

Ahead of announcing the FY23 Budget, the Union Cabinet has approved ₹ 2,600 crore incentive scheme for banks to promote RuPay debit card, BHIM-UPI. The scheme has been announced to promote the use of economical and user-friendly payment platforms.

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The Union Cabinet has approved ₹ 2,600 crore incentive scheme for banks to support them in promoting digital payment platforms like RuPay debit card, BHIM-UPI etc. Announced in line with the FY23 Budget, the scheme promises to promote the use of economical and user friendly payment platforms.

RuPay is India’s solution to international payment networks and is a first of its kind global card payment network, with wide acceptance of ATMs, PoS devices and e-commerce websites. RuPay is a product of the National Payments Corporation of India (NPCI), the organization that powers retail payments in the country.

Under the scheme, beneficiary banks will be offered financial incentives for promoting Point-of-Sale (PoS) and e-commerce transactions using RuPay debit cards and low value BHIM-UPI transactions (person-to-merchant).

With consistent strategies introduced by government, the total digital payments transactions have registered a YoY growth of 59%, rising from 55.54 crore in FY2020-21 to 8,840 crore in FY 2021-22. BHIM-UPI transactions have also registered a YoY growth of 106%, rising from 2,233 crore in FY2020-21 to 4,597 crore in FY 2021-22. UPI has achieved a record of 782.9 crore digital payment transactions with a value of ₹ 12.82 lakh crore in the month of December 2022.

The incentive scheme aims to build a robust digital payment ecosystem in-line with the objective of “Sabka Saath, Sabka Vikas”. Additionally, it will also promote UPI Lite and UPI 123PAY as economical and user-friendly digital payments solutions.