India, March 19 -- The Union Cabinet today approved an 'incentive scheme', aimed at promoting low-value BHIM-UPI transactions for the financial year 2024-25.

The scheme, with an estimated outlay of INR 1,500 Cr, will incentivise low-value BHIM-UPI transactions to encourage usage among small merchants.

The incentive will be provided at the rate of 0.15% per transaction value for transactions up to INR 2,000 pertaining to the category of small merchants, the government said in a statement.

"The scheme will enable small merchants to avail of UPI services at no additional cost. As small merchants are price-sensitive, incentives would encourage them to accept UPI payment, it added.

With this initiative, the government aims to penetrate UPI...