An incentive scheme for the promotion of low-value BHIM-UPI transactions

Current Context: The Incentive Scheme for promoting low-value BHIM-UPI transactions (P2M) was introduced to encourage small-value digital payments, particularly aimed at merchants in rural and remote areas.

Approved on March 19, 2025, with a total outlay of ₹1,500 crore, this scheme focuses on UPI transactions up to ₹2,000.
Under the scheme, merchants receive an incentive of 0.15% per transaction value, which reduces their cost burden and promotes greater adoption of digital payments.
The initiative aligns with the government’s goal of moving toward a less-cash economy while boosting financial inclusion.
Additionally, it aims to achieve a targeted transaction volume of ₹20,000 crore for the financial year 2024-25, making digital payments seamless and accessible for small-scale merchants and customers alike.

Question:

Q.1 What is the upper limit of UPI transaction value covered under the Incentive Scheme for promoting low-value BHIM-UPI transactions (P2M)?
a) ₹1,000
b) ₹1,500
c) ₹2,000
d) ₹5,000

Answer: c) The scheme applies to transactions up to ₹2,000, ensuring that small-scale transactions are incentivized.