MUMBAI: In a big boost for digital payments, the RBI has announced a fund that will subsidise deployment of card-acceptance devices and QR codes in tier-3 to tier-6 towns and in the northeast. The Payments Infrastructure Development Fund (PIDF), which currently stands at Rs 345 crore, will go up further with contributions from banks yet to come in.
The RBI has contributed Rs 250 crore to the fund, payment networks will pump in Rs 100 crore and banks will give Re 1 for every debit card and Rs 3 for every credit card they have issued. The PIDF has a validity of three years and will target to increase the number of card swipe (point of sales, or PoS) machines by 10 lakh and the number of shops accepting QR code-based payments by 20 lakh.
Priority will be given to merchants providing essential services like transport, hospitality, government payments, fuel pumps, PDS shops, healthcare and kirana stores. The RBI will subsidise 30% to 50% of the cost of a card swipe machine and between 50% and 75% of the cost of acquiring a merchant for QR code acceptance.
In addition to the one-time charges, the card networks (Visa, Mastercard and RuPay) will pay 1 paisa for every transaction, while card-issuing banks will pay 1 paisa for debit card and 2 paise for every credit card transaction. This will ensure that the burden of contributing to the fund will fall equally on banks that have issued a large number of cards and those that have maximum card usage.
“All schemes in the past have been targeted toward banks. Fintech and nonbanks are playing a very important role, so this is a very welcome move. There are close to nine million merchants who are not accepting digital payments and who can now join the bandwagon,” said Pine Labs president and COO Nitish Asthana.