Union Cabinet Approves Rs 15 Billion Incentive for BHIM-UPI Growth
ECONOMY & POLICY

Union Cabinet Approves Rs 15 Billion Incentive for BHIM-UPI Growth

The Union Cabinet has approved a Rs 15 billion scheme to promote low-value BHIM-UPI peer-to-merchant (P2M) transactions for FY 2024-25. The initiative aims to drive digital payments and achieve a target of 200 billion transactions in the fiscal year. 

For the first time, the government has defined small and large merchants for BHIM-UPI incentives. Transactions up to Rs 2,000 made to small merchants will receive an incentive at a rate of 0.15%, while large merchants in the same bracket will receive no incentive. No incentives will be provided for transactions exceeding Rs 2,000. 

Prime Minister Narendra Modi called the scheme a step towards enhancing digital payments and ‘Ease of Living’. However, industry players have raised concerns over the funding allocation. Vishwas Patel, Joint MD of Infibeam Avenues and Chairman of the Payments Council of India (PCI), argued that the Rs 15 billion allocation would be insufficient to sustain the ecosystem, which processed Rs 246.82 trillion in UPI transactions in 2024. He suggested introducing a controlled MDR (Merchant Discount Rate) of 25 bps for merchants with over Rs 4 million turnover, while maintaining zero MDR for smaller merchants. 

In FY24, the government provided Rs 32.68 billion in incentives for BHIM-UPI, compared to Rs 18.02 billion in FY23 and Rs 9.57 billion in FY22. Additional Rs 4.08 billion and Rs 4.32 billion were allocated for promoting RuPay debit cards in previous years. 

The government has set conditions for the disbursement of funds, ensuring that 80% of admitted claims by acquiring banks will be disbursed unconditionally, while the remaining 20% will be linked to factors such as maintaining technical declines below 0.75% and a system uptime of over 99.5%. 

(Business Standard) 
                      

The Union Cabinet has approved a Rs 15 billion scheme to promote low-value BHIM-UPI peer-to-merchant (P2M) transactions for FY 2024-25. The initiative aims to drive digital payments and achieve a target of 200 billion transactions in the fiscal year. For the first time, the government has defined small and large merchants for BHIM-UPI incentives. Transactions up to Rs 2,000 made to small merchants will receive an incentive at a rate of 0.15%, while large merchants in the same bracket will receive no incentive. No incentives will be provided for transactions exceeding Rs 2,000. Prime Minister Narendra Modi called the scheme a step towards enhancing digital payments and ‘Ease of Living’. However, industry players have raised concerns over the funding allocation. Vishwas Patel, Joint MD of Infibeam Avenues and Chairman of the Payments Council of India (PCI), argued that the Rs 15 billion allocation would be insufficient to sustain the ecosystem, which processed Rs 246.82 trillion in UPI transactions in 2024. He suggested introducing a controlled MDR (Merchant Discount Rate) of 25 bps for merchants with over Rs 4 million turnover, while maintaining zero MDR for smaller merchants. In FY24, the government provided Rs 32.68 billion in incentives for BHIM-UPI, compared to Rs 18.02 billion in FY23 and Rs 9.57 billion in FY22. Additional Rs 4.08 billion and Rs 4.32 billion were allocated for promoting RuPay debit cards in previous years. The government has set conditions for the disbursement of funds, ensuring that 80% of admitted claims by acquiring banks will be disbursed unconditionally, while the remaining 20% will be linked to factors such as maintaining technical declines below 0.75% and a system uptime of over 99.5%. (Business Standard)                       

Related Stories

Gold Stories

Next Story
Products

Koemmerling opens Navi Mumbai experience centre

Koemmerling, a brand of the profine Group, has expanded its presence in the Mumbai metropolitan region with the opening of a new experience centre in Navi Mumbai and launched its Allure S46 minimal sliding door system for the Indian market.Located in CBD Belapur, the facility was inaugurated by Peter Mrosik, Owner and CEO, profine Group, along with Farid Khan, Chairman and Managing Director, profine India, and Kamal Bajaj, CEO, profine India.The company said the new centre will showcase its portfolio of uPVC and aluminium window and door systems to architects, developers and homeowners.The ina..

Next Story
Products

India's waterproofing market nears Rs 150 bn milestone

India's waterproofing industry is approaching a market size of Rs 150 billion and is expected to surpass the $2 billion milestone, according to speakers at the 2nd India International Waterproofers Conference & Expo 2026 organised by the Waterproofers Association of India (WAI) in New Delhi.The two-day event brought together more than 20 speakers, 55 international delegates and 53 exhibition booths, with discussions focusing on climate-resilient construction, advanced waterproofing technologies and international collaboration.Inaugurating the event, Durga Shanker Mishra, former Secretary, ..

Next Story
Real Estate

Dilip Buildcon Q1 FY27 Revenue at Rs 23.78 billion

Dilip Buildcon Limited reported consolidated revenue from operations of Rs 2,378 crore in Q1 FY27, along with EBITDA of Rs 429 crore and profit after tax of Rs 128 crore.Consolidated EBITDA margin stood at 18.1%, improving from 17.1% in Q4 FY26. On a standalone basis, revenue from operations was Rs 1,930 crore, EBITDA stood at Rs 199 crore and PAT was Rs 39 crore, with an EBITDA margin of 10.3%.The company’s order book stood at Rs 27,691 crore as of 30 June 2026, compared with Rs 28,830 crore as of 31 March 2026. Roads and highways accounted for 17.1% of the order book, irrigation and water ..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement