Govt approves incentive scheme for BHIM-UPI & RuPay

Govt approves incentive scheme for BHIM-UPI & RuPay

• The Ministry of Electronics and Information Technology, Government of India, Notified an incentive scheme for the promotion of RuPay Debit cards and low-value BHIM-UPI transactions (P2M) on December 17, 2021. Following the approval by the Unio,
• Union Cabinet has approved a scheme to increase the use of RuPay debit cards and low-value BHIM-UPI transactions. During a cabinet meeting chaired by Prime Minister Narendra Modi initiative which would boost the use of RuPay debit cards and person-to-person UPI transactions up to INR 2,000/- was approved.
• The govt will pay a portion of the value of transactions done via the RuPay and BHIM-UPI systems to acquiring banks as part of the scheme. According to estimates scheme is expected to cost around Rs 1,300 crore in the fiscal year 2021-2022,

RuPay and BHIM-UPI systems

“Under the scheme, the government will help encourage the acquiring banks by 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 outlay of Rs 1,300 crore for a one-year period beginning April 1, 2021,” according to an official statement.

• This initiative would help acquiring banks develop a strong digital payment ecosystem by promoting Rupay debit cards and BHIM-UPI digital transactions across all sectors and segments of the population, as well as strengthening digital payments in the country, according to the statement.
• The scheme was created in response to the government’s Budget declarations (FY2021-22) to provide digital transactions in the country a boost.
• A production linked incentive (PLI) programme for semiconductor and display board production was also approved by the cabinet.

New Update On UPI Payment:

• The Reserve Bank of India governor said that the central bank has proposed to enhance the limit of Unified Payments Interface (UPI) transactions in educational institutions & hospitals to INR 5,00,000/- from INR 1,00,000/-.
• Reserve Bank of India governor also said that the Reserve Bank of India has proposed to enhance limits of e-mandates for recurring online transactions to INR 1,00,000/- per transaction from INR 15,000/- per transaction for insurance premium subscriptions, mutual fund subscriptions,  & credit card online repayments.
• This New Update On UPI Payment will help the consumers to make Unified Payments Interface (UPI) payments of higher amounts for health care & education purposes.

Union Minister Anurag Thakur :

• A scheme has been approved to provide incentives to encourage digital transactions through RuPay Debit Card and BHIM UPI of small amounts. It will incur an expense of around Rs 1,300 Crores:

• According to Union Minister Anurag Thakur, the initiative will invest 76,000 crore in semiconductor production over the next five to six years.
• According to Telecom and IT Minister Ashwini Vaishnaw decision will aid in the design, production, packing, and testing of microchips as well as the development of a full ecosystem.
  

Government is not considering levying Goods and Services Tax (GST) on UPI transactions over 2,000

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