To boost the digital payments, the government has stated that all businesses with a turnover of Rs 50 crore or more have to operationalise payments through Rupay and Bhim UPI, failing which they have to pay a hefty penalty of Rs 5,000 per day from February 1.
The value of UPI transactions had breached the Rs 2 lakh crore mark in December last year, witnessing a 100 per cent rise year-on-year. It is for the first time since UPI’s inception in 2016 that the value of transactions has reached Rs 2 lakh crore.
The surge has gone in favour of private sector players such as Paytm, Google Pay and PhonePe, which dominate the UPI space as most of the transactions are done via these platforms. Government-run BHIM, which also uses UPI, still trails its private sector peers.
However, after this Central Board of Direct Taxes (CBDT) notification comes into place, the market will tilt in favour of Rupay and Bhim, with both expected to see a major boost. The CBDT notification says that business establishments with an annual turnover of more than Rs 50 crore, shall offer low-cost digital modes of payment (such as BHIM UPI, UPI QR Code, Aadhaar Pay, Debit Cards, NEFT, RTGS etc.) to their customers, and no charge or Merchant Discount Rates (MDR) shall be imposed on customers and merchants.