2 hours Ago By Bhupendra Paintola
The Budget document tabled by Finance Minister Nirmala Sitharaman revealed a reduction in the incentive scheme for promoting RuPay debit cards and low-value BHIM-UPI transactions (person-to-merchant) from INR 2,000 Cr last year to INR 437 Cr for the upcoming fiscal year. However, the INR 2,000 Cr allocation in 2024 was a revised estimate against the INR 1,441 Cr earmarked in the budget estimate for 2024. While broader new-age stocks saw a rally in the stock market today, fintech shares like MobiKwik, Paytm, and PB Fintech, under Inc42's radar, ended the day’s trade in the red Reflecting a significant move in digital payments, the government has lowered its incentives for promoting RuPay debit cards and low-value UPI transactions up to INR 2,000.
The Budget document tabled by Finance Minister Nirmala Sitharaman revealed a reduction in the incentive scheme for promoting RuPay debit cards and low-value BHIM-UPI transactions (person-to-merchant) from INR 2,000 Cr last year to INR 437 Cr for the upcoming fiscal year. However, the INR 2,000 Cr allocation in 2024 was a revised estimate against the INR 1,441 Cr earmarked in the budget estimate for 2024. Notably, the government has been gradually reducing allocations for this scheme over the years.
In 2023, the scheme was introduced with an initial outlay of INR 2,484 Cr. This development in the budget further impacted fintech stocks that are stakeholders in UPI and RuPay transactions. While broader new-age stocks saw a rally in the stock market today, fintech shares like MobiKwik, Paytm, and PB Fintech, under Inc42’s radar, ended the day’s trade in the red.
The trio, MobiKwik, Paytm, and PB Fintech, ended the day’s trading 2.08%, 4.18%, and 0.
8% lower on the BSE, respectively. While the reduction in incentives for UPI transactions may have an impact, other budgetary measures, such as the personal income tax exemption up to INR 12.75 Lakh, could contribute to increasing UPI transaction volumes by providing more disposable income.
Today’s announcement coincides with UPI transactions reaching an all-time high in January, recording 16.99 Bn transactions. UPI transactions rose 1.
5% in January to 16.99 Bn from 16.73 Bn in the preceding month .
The total transaction value stood at INR 23.48 Lakh Cr in January, up from INR 23.25 Lakh Cr in the previous month.
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