UPI Vyapaar Saksham Sets Rs 300 Incentive Per New QR Code

The National Payments Corporation of India (NPCI) has introduced the UPI Vyapaar Saksham Scheme to expand UPI acceptance among small merchants, in a circular dated November 11, 2026. The scheme offers incentives of Rs 300 for every physical QR code and Rs 750 for every soundbox deployed at an eligible new small merchant.

NPCI defines a small merchant as a business with an annual turnover of up to Rs 40 lakh in the preceding financial year. The scheme will be funded from UPI merchant discount rate (MDR) collections and will run for three years from the date MDR on UPI is implemented. The QR code and soundbox incentives are paid to the acquiring bank that deploys them, not directly to the shopkeeper.

UPI Vyapaar Saksham at a glance

Which small merchants UPI Vyapaar Saksham covers

The UPI Vyapaar Saksham Scheme focuses on small merchants in Tier 3 to Tier 6 centres, the North-Eastern states, Jammu and Kashmir and Ladakh. Small merchants covered under notified Central Government schemes, including PM SVANidhi and PM Vishwakarma, are also eligible, even in Tier 1 and Tier 2 cities.

Only UPI payments of up to Rs 2,000 count as eligible transactions under the scheme. Each issuing bank, acquiring bank, payer payment service provider (PSP) and UPI app provider taking part in UPI will put 5% of its MDR share into the scheme's fund.

How the UPI Vyapaar Saksham fund is split three ways

The fund has three parts. The first, with 30% of the money, covers new merchant onboarding. It pays Rs 300 per physical QR code and Rs 750 per soundbox at an eligible new small merchant. To qualify, the merchant must record at least 25 eligible transactions in two months of a quarter, with a minimum transaction value of Rs 5,000 in each of those months.

The second part, with 50% of the fund, rewards growth in UPI transactions. It needs at least 5% quarter-on-quarter growth in eligible transaction volume and pays 0.03% of the total value of eligible transactions, with an extra 50% incentive for merchants in the targeted areas. The third part, with the remaining 20%, pays 0.2% of the increase in eligible transaction value over the previous quarter in the targeted areas.

The soundbox and growth targets NPCI has set for UPI Vyapaar Saksham

NPCI expects the UPI Vyapaar Saksham Scheme to support 5 lakh to 10 lakh new soundbox installations every year. It also aims for 30% to 50% annual growth in transaction volumes among existing small merchants.

What UPI Vyapaar Saksham offers small shops over three years

The UPI Vyapaar Saksham Scheme puts 5% of UPI MDR collections into a fund for small merchants with a turnover of up to Rs 40 lakh. It pays Rs 300 for each new QR code and Rs 750 for each new soundbox at eligible shops, plus incentives linked to transaction growth. The scheme runs for three years from the date MDR on UPI is implemented.

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