The Payments Infrastructure Development Fund scheme is expected to significantly increase the acceptance channels to keep pace with the issuances, players said welcoming the scheme.

“There are almost 80 crore cards, so the issuance side is sorted but there are problems on the acceptance side,” said Vishwas Patel, Chairman, Payments Council of India and a member of the ex-officio Advisory Committee of the PIDF.

Patel pointed out there are just about 40 lakh PoS terminals, and in the Tier 3 to Tier 6 towns, the acceptance network is poor and not commercially viable, even for QR codes at the Gram Panchayat level.

“If you see ATM withdrawals, people withdraw their salary and then use the money at kirana shops and roadside vendors. Why can’t they use the payment options directly with the merchants as well,” Patel noted.

The Reserve Bank of India had on January 5 announced the operationalisation of the PIDF scheme 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 had said.

Patel said the PIDF will ensure the ecosystem grows together on the issuance, card network ad acquiring side.

In a recent statement, Payments Council of India had welcomed the move and said it would help take digitisation of payments into the hinterlands of the country.

“We are confident that this significant move will provide a fillip to the last mile penetration of digital payments and acceptance infrastructure - thereby driving digital financial inclusion in the hinterland. Special focus on NE is well deserved, and will accelerate digitisation. This well timed RBI’s initiative of PIDF creation, along with the recently announced increased limit of contactless payments from ₹2,000 to ₹5,000, will promote significant adoption of digital transactions,” Dilip Asbe, Managing Director and CEO of National Payments Corporation of India had said.

Dilip Modi, Founder, Spice Money had similarly noted that accessibility and availability of financial services are major challenges that hamper financial inclusion of rural and underserved segment. “The introduction of RBI’s PIDF scheme will provide a big boost to financial advancement in India’s semi urban and rural economy, especially at a time when this segment needs immediate support to jump back into the economy,” he had further said.