Cabinet Approves Rs 1,500 Crore To Incentivise Low-Value UPI Transactions

The Union Cabinet on Wednesday approved an incentives scheme worth approximately Rs 1,500 crore to promote UPI transactions below Rs 2,000 for 2024-25, an official statement said. Under the scheme, the government will bear MDR (Merchant Discount Rate) expense for payment of less than Rs 2,000 made by a person to a merchant.

"The Union Cabinet chaired by Prime Minister Narendra Modi today approved the 'Incentive Scheme for promotion of low-value BHIM-UPI transactions Person to Merchant (P2M)' for the financial year 2024-25," the statement said. The incentive scheme for the promotion of low-value BHIM-UPI transactions (P2M) will be implemented at an estimated outlay of 1,500 crore from April 1, 2024, to March 31, 2025.

Only the UPI (P2M) transactions of up to Rs 2,000 for small merchants are covered under the scheme. "Incentive at the rate of 0.15 per cent per transaction value will be provided for transactions up to Rs 2,000 pertaining to the category of small merchants," the statement said.

(PTI)