Monday 27 June 2022
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Cabinet approves incentive for RuPay, BHIM UPI payments

The cabinet cleared also the production-linked incentive scheme (PLI) for semiconductors with the ambition of making the country an electronics hub

The union cabinet has approved a scheme to provide incentives to encourage digital transactions through RuPay Debit Card and BHIM UPI of small amounts. Union Minister Finance told reporters, while briefing the press on 15 December, the scheme would incur a cost of around Rs 1,300 crore.

Under the scheme, the acquiring banks will be incentivised by the government, by way of paying a percentage of the value of transactions (P2M) done through RuPay debit cards and low-value BHIM-UPI modes of payments, at an estimated financial cost of Rs 1,300 crore for a period of one year, which will be effective from 1 April.

It will also help in making accessible, digital modes of payments to unbanked and marginalised sections of the population, who are not part of the formal banking and financial system, official sources said.

Explaining the scheme further, IT Minister Ashwini Vaishnav said that the government will reimburse transaction charges levied on digital payments made by persons to the merchant as part of the merchant discount rate (MDR).

“In the coming one year…the government will invest around Rs 1,300 crore so that more and more people move towards digital payments,” Vaishnaw said. He also said that 423 crore digital transactions valued at Rs 7.56 lakh crore took place in November.

Along with this, the cabinet cleared also the production-linked incentive scheme (PLI) for semiconductors with the ambition of making the country an electronics hub as the shortage of microchips hurts industrial production.

“An ambitious project to establish a complete ecosystem of semiconductors and display manufacturing has been sanctioned. Rs 76,000 crores will be spent on this project in 6 years”, said Union Minister while briefing the press.

Another scheme approved by the cabinet is the implementation of Pradhan Mantri Krishi Sinchayee Yojana for 2021-26. The scheme is said to benefit about 22 lakh farmers, including 2.5 lakh Scheduled Caste and 2 lakh Scheduled Tribe farmers.

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