Union Government announces package for promotion of Digital and Cashless Economy
NABARD will extend financial support to eligible banks for deployment of 2 POS devices each in 1 Lakh villages with population of less than 10000.
The Union Government on 8 December 2016 announced the package of incentives and measures for promotion of digital and cashless economy in the country.
The move came following the cancellation of the legal tender of old Rs 500 and Rs 1000 notes, as since then, there has been a surge in the digital transactions through use of credit/debit cards and mobile phone applications and e-wallets.
Highlights of the Package
- The Petroleum PSUs will offer incentive by providing a discount at the rate of 0.75 percent of the sale price to consumers on purchase of petrol/diesel, if the payment is made through digital means.
- To expand digital payment infrastructure in rural areas, NABARD will extend financial support to eligible banks for deployment of 2 POS devices each in 1 Lakh villages with population of less than 10000. This will benefit farmers of one lakh village covering a total population of nearly 75 crore.
- NABARD will also support Rural Regional Banks and Cooperative Banks to issue Rupay Kisan Cards to around 4.32 crore Kisan Credit Card holders to enable them to make digital transactions at POS machines/Micro ATMs/ATMs.
- Railways, through its sub urban railway network, will provide incentive by way of discount of up to 0.5 percent to customers for monthly or seasonal tickets from January 2017, if payment is made through digital means.
- Passengers buying online ticket will be given free accidental insurance cover of up to Rs 10 lakh. With this, nearly 11 lakh passengers will be covered in a day under the accidental insurance scheme.
- Railways will provide a discount of 5 percent for paid services like catering, accommodation, retiring rooms etc., if payment is made through digital means.
- Public sector insurance companies will provide incentive of up to 10 percent of the premium in general insurance policies and 8 percent in new life policies of Life Insurance Corporation sold through the customer portals, if payment is made through digital means.
- The Union Government Departments, State Governments and Central Public Sector Undertakings will ensure that transactions fee/MDR charges associated with payment through digital means shall not be passed on to the consumers and shall be borne by them only.
- In Public sector banks, merchant should not be required to pay more than Rs 100 per month as monthly rental for PoS terminals/Micro ATMs/mobile POS in order to bring small merchant on board the digital payment eco system.
- No service tax will be charged on digital transaction charges/MDR for transactions upto Rs 2000.
- For the payment of toll at Toll Plazas on National Highways using RFID card/Fast Tags, a discount of 10 percent will be available to users in the year 2016-17.