NPCI launches scheme paying small shopkeepers Rs 300 for QR code, Rs 750 for soundbox

The National Payments Corporation of India (NPCI) has launched the 'UPI Vyapar Saksham Yojana' to increase digital payments among small shopkeepers. QR codes are now seen at tea stalls, vegetable carts and grocery shops alike, and people pay by mobile instead of carrying cash. Even so, many small shopkeepers remain outside digital payments. They feel it is not for them, that it will cost too much and that they will not be able to manage it.

Under the scheme, small shopkeepers will be paid to put up a QR code and install a soundbox in their shops. The money will come through the bank. The aim is to take the benefit to the smallest traders in the country.

Eligibility is straightforward. A shopkeeper with annual turnover of up to Rs 40 lakh qualifies, which works out to business of about Rs 3 lakh a month. Both existing shopkeepers and those opening new shops are covered.

The scheme gives greater weight to small towns and villages. Shopkeepers in Tier-3 to Tier-6 centres, meaning small towns and rural areas, will get the benefit first. Special attention has also been given to traders in the north-eastern states, Jammu and Kashmir and Ladakh. Small shopkeepers in big cities who are covered under other Central government schemes can also take the benefit.

NPCI has set aside 30 per cent of the scheme's total fund for bringing new traders into the digital system. A new shopkeeper who puts up a QR code will get Rs 300, and one who installs a soundbox will get Rs 750. A soundbox is a small device that announces a message such as "Rs 50 received", so the shopkeeper knows the money has arrived. But merely putting up a QR code will not earn the payment; there is a condition.

The trader must make at least 25 valid digital transactions a month in at least two of the three months of the given quarter. That means receiving money by UPI at least 25 times in each of at least two of the three months. Total transactions in those months must also exceed Rs 5,000. In other words, the board is not to be merely displayed but used. Even one or two transactions a day would easily reach the figure of 25.

Fifty per cent of the scheme's fund is reserved solely for increasing the number of transactions. If a shopkeeper raises transactions by at least 5 per cent over the previous three months, they will get an additional 0.03 per cent of total transactions. An incentive of up to 0.20 per cent will also be paid on the transaction amount that has grown over the previous quarter. The more business is done on UPI, the greater the benefit.

The scheme will run for three years from the date the merchant discount rate comes into force. NPCI estimates that 60 lakh to 1 crore new QR codes will be put up and 5 lakh to 10 lakh new soundboxes installed every year. This will lower digital payment costs for shopkeepers in villages and small towns and help their business grow.