Budget 2023-24: Government Reduces Subsidies for Fintechs and Banks on UPI Transactions

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Budget 2023-24: Government Reduces Subsidies for Fintechs and Banks on UPI Transactions

The government has cut down the subsidy meant for compensating fintech startups and banks that facilitate UPI transactions in its Union Budget 2023-24 announcements.

The government has reduced the incentive allocation for fintechs and banks by nearly 30%, from INR 2,137 Cr in the previous budget to INR 1,500 Cr. In fact, the government only set aside INR 200 Cr as a subsidy to compensate UPI players in the 2021-22 budget. However, industry stakeholders, including the Reserve Bank of India (RBI), have warned that the move could harm UPI growth. As a result, the government increased the incentive scheme’s budget by more than tenfold in 2022-23.

Sreejit Kumar
Sreejit Kumar
Hi, I'm Sreejit Kumar, a journalist with a Master's degree in Journalism. Through my education and professional experience, I have developed a keen eye for detail and a passion for uncovering the truth. As an author for this news website, I am committed to delivering accurate, timely, and engaging stories that inform and entertain our readers.

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The government has cut down the subsidy meant for compensating fintech startups and banks that facilitate UPI transactions in its Union Budget 2023-24 announcements.

The government has reduced the incentive allocation for fintechs and banks by nearly 30%, from INR 2,137 Cr in the previous budget to INR 1,500 Cr. In fact, the government only set aside INR 200 Cr as a subsidy to compensate UPI players in the 2021-22 budget. However, industry stakeholders, including the Reserve Bank of India (RBI), have warned that the move could harm UPI growth. As a result, the government increased the incentive scheme’s budget by more than tenfold in 2022-23.

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Sreejit Kumar
Sreejit Kumar
Hi, I'm Sreejit Kumar, a journalist with a Master's degree in Journalism. Through my education and professional experience, I have developed a keen eye for detail and a passion for uncovering the truth. As an author for this news website, I am committed to delivering accurate, timely, and engaging stories that inform and entertain our readers.

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