Payment Industry Disappointed with "Paltry" Rs 2,000 Crore UPI, RuPay Subsidy

• The payment industry expresses disappointment over the Rs 2,000 crore budget allocation for UPI and RuPay debit card incentives, deeming it insufficient.
• Industry leaders warn that low subsidies and the absence of Merchant Discount Rate (MDR) will severely hinder the growth of digital payments, especially in rural areas.
• The Payment Council of India (PCI) stated that the "Zero MDR" policy for UPI, coupled with the small incentive, will choke the ecosystem's ability to scale and onboard new users.
• PCI had anticipated an incentive exceeding Rs 10,000 crore, citing rising deployment, servicing, and RBI compliance costs for fintech companies.
• The industry suggests allowing a low, controlled MDR of 30 BPS on UPI P2M transactions for merchants with over Rs 20 lakh turnover to ensure sustainable monetization.

Why It Matters: Payment industry criticizes the Rs 2,000 crore UPI/RuPay subsidy as inadequate, fearing it will impede digital payment growth.