Starting 1 February 2020, businesses with over Rs 50 crore in sales will have to compulsorily offer some specified modes of electronic payments like debit cards with RuPay, in addition to the modes already provided by them.
In a notification on Monday, the Ministry of Finance said that these businesses will have to accept payment modes of debit cards powered by RuPay, Unified Payments Interface (UPI) and Unified Payments Interface Quick Response Code (UPIQRC) along with existing modes.
RuPay is a card payment scheme offered by National Payments Corp. of India (NPCI). The notification specified NPCI's BHIM UPI and QR Code payment facility.
This requirement is effective from 1 January 2020, however, a one month grace period has been allowed before penalty is enforced on these businesses. The requirement was introduced through the Income Tax (16th Amendment) Rules of 2019.
On failure to comply, a default fine of Rs 5,000 per day will be charged on a business.
Last week, Finance Minister Nirmala Sitharaman said that the no MDR (Merchant Discount Rate) charges will be applicable on transactions through RuPay cards and UPI payments.
The government's intent is to boost digital transactions and support the payment and settlement system of NPCI, a non-profit organisation established by RBI.