Payments Infrastructure Development Fund – Extension of Scheme and Inclusion of PM Vishwakarma Scheme beneficiaries

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The Payments Infrastructure Development Fund (PIDF) Scheme was operationalised by the Reserve Bank in January 2021 for a period of three years. The objective was to incentivise the deployment of payment acceptance infrastructure such as physical Point of Sale (PoS), Quick Response (QR) codes in tier-3 to tier-6 centres, north eastern states and Union Territories of Jammu & Kashmir and Ladakh. Beneficiaries of PM SVANidhi Scheme in Tier-1 and 2 centres were later included in August 2021. As at end-August 2023, over 2.66 crore new touch points have been deployed under the Scheme. It is now proposed to extend the PIDF Scheme by a further period of two years, i.e., upto December 31, 2025. Also, it is proposed to include beneficiaries of PM Vishwakarma Scheme in all centres under the PIDF Scheme. This decision to expand the targeted beneficiaries under the PIDF scheme will provide fillip to the Reserve Bank’s efforts towards promoting digital transactions at the grassroots level.

Further, based on the feedback received from industry, deployment of emerging modes of payment acceptance, such as soundbox devices and Aadhaar-enabled biometric devices, are proposed to be encouraged under the PIDF Scheme. This is expected to further accelerate and augment the deployment of payment acceptance infrastructure in the targeted geographies. The amendments will be notified shortly.

Scheme Details:

Market Segments and Merchant Categories

Merchants providing essential services (transport, hospitality, etc.), government payments, fuel pumps, PDS shops, healthcare, kirana shops, street vendors, etc., may be covered, especially in the targeted geographies.

Types of Acceptance Devices Covered

Multiple payment acceptance devices / infrastructure supporting underlying card payments, such as physical PoS, mPoS (mobile PoS), GPRS (General Packet Radio Service), PSTN (Public Switched Telephone Network), QR code-based payments, etc.

As the cost structure of acceptance devices vary, subsidy amounts shall accordingly differ by the type of payment acceptance device deployed. A subsidy of 60% to 75% of cost of physical PoS and 75% to 90% for Digital PoS shall be offered.

Payment methods that are not inter-operable shall not be considered under PIDF.

The subsidy shall not be claimed by applicant from other sources like NABARD, etc. In case other mechanisms exist for providing subsidy or reimbursing cost of deployment of acceptance infrastructure, no reimbursement shall be claimed from PIDF therefor.

Initial Corpus

Initial corpus of PIDF has to be substantial to initiate pan-India terminalisation and to cover the pay-outs in the first year. Contributions to the PIDF shall be mandatory for banks and card networks.

RBI shall contribute Rs.250 crore to the corpus; the authorised card networks shall contribute in all Rs.100 crore.

The card issuing banks shall also contribute to the corpus based on the card issuance volume (covering both debit cards and credit cards) at the rate of Rs.1 and Rs.3 per debit and credit card issued by them, respectively.

It shall be the endeavour to collect the contributions by January 31, 2021.

Any new entrant to the card payment eco-system (card issuer and card network) shall contribute an appropriate amount to the PIDF.

RBI

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