RBI issues information regarding “Operationalisation of Payments Infrastructure Development Fund (PIDF) Scheme”; intends to increase the number of acceptance devices multi-fold in the country

The Reserve Bank of India (“RBI”) on 5th January, 2021 has issued a notification regarding the “Operationalisation of Payments Infrastructure Development Fund (PIDF) Scheme” (“Scheme”)

Key Highlights:

1. The Scheme aims at increasing the number of acceptance devices multi-fold in the country. The Scheme is expected to benefit the acquiring banks / non-banks and merchants by lowering overall acceptance infrastructure cost.

2. The PIDF will be valid for 3 years from January 01, 2021, and is extendable by two further years, if necessary.

3. The PIDF targets at increasing payments acceptance infrastructure by adding 30 lakh touch points – 10 lakh physical and 20 lakh digital payment acceptance devices every year.

4. Types of Acceptance Devices Covered:

a. 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.

b. As the cost structure of acceptance devices vary, subsidy amounts shall accordingly differ by the type of payment acceptance device deployed. A subsidy of 30% to 50% of cost of physical PoS and 50% to 75% subsidy for Digital PoS shall be offered.

c. Payment methods that are not inter-operable shall not be considered under Payments Infrastructure Development Fund (“PIDF”).

d. The subsidy must 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.
5. Recurring Contribution:
a. Besides the initial corpus, the PIDF shall also receive annual contribution from card networks and card issuing banks as under:
a. Card networks – Turnover based – 1 basis point (bps) i.e., 0.01 paisa per Rupee of transaction;
b. Card issuing banks – Turnover based – 1 bps and 2 bps i.e., 0.01 paisa and 0.02 paisa per Rupee of transaction for debit and credit cards respectively; also at the rate of ₹ 1 and ₹ 3 for every new debit and credit card issued by them respectively during the year.
In case of any shortfalls, the contributions shall be made by RBI.
6. Further, the Scheme provides information regarding initial corpus of the PIDF, target geographies under the Scheme, deployment target for acquirers, claims etc.


Through the Statement on Developmental and Regulatory Policies dated October 4, 2019 and the Press Release dated June 05, 2020 RBI had announced creation of PIDF. The PIDF is intended to subsidise deployment of payment acceptance infrastructure in Tier-3 to Tier-6 centres with special focus on North-Eastern States of the country. It envisages creating 30 lakh new touch points every year for digital payments.

The RBI has requested all stakeholders to co-operate in this regard by –

(a) making their contributions to PIDF within the timelines, and

b) deploying acceptance infrastructure and seeking reimbursement from PIDF.


Source: Reserve Bank of India


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