Come next year, and you might get tax benefits for Unified Payments Interface (UPI) QR code digital payment.
The National Payments Corporation of India (NPCI) members have reportedly given the nod to a proposal for incentivising digital payments via QR code on UPI.
Consumers and merchants can get tax benefits upon sharing their PAN and GSTIN details, respectively, as per people attending the last steering committee meeting.
The quantum of the incentives is yet to be decided. As per sources, it would be mainly according to the size of the transactions.
NPCI is reportedly planning to store PAN data in an encrypted format. The retail payment body will now work on the implementation plan after getting approval from the govt. In the first phase, the implementation will give incentives to merchants and then to consumers, said TOI report.
The move is in line with the govt’s plan to incentivise digital payments and achieve its target of 40 billion digital transactions by March 2020.
The development has come at a time when UPI has been witnessing unprecedented growth.
In August, it recorded 918.35 million transactions worth Rs 1,54,504.89 crore, which is a significant leap of 11.68% from July when it registered 822.29 million transactions worth 1,46,386.64 crore.
For the UPI, achieving two consecutive feats of crossing 800 million marks in July and 900 million mark in August is a strong testimony to the increasing acceptance of the digital transactions in India.
A recently concluded Boston Consultancy Group’s report on digital payments landscape in India also highlighted the future growth for UPI. It said that UPI would dominate the payments space with 59% payments transactions, followed by mobile and internet-based payments.
The significant contribution in UPI volume comes from three digital payment giants – Google Pay, PhonePe and Paytm.
Meanwhile, NPCI is mulling over capping UPI market share to 33% for all apps running on UPI railroad. The move will prevent the concentration of volume (number of transactions) by a few entities such as PhonePe and Google Pay, which have been scoring more than 33% each in UPI ecosystem.