NPCI's UPI Vyapar Saksham Scheme: Rs 300 for a QR Code and Rs 750 for a Soundbox at Small Shops

The National Payments Corporation of India (NPCI) has launched a new scheme to take UPI to small shops in smaller towns. In a circular issued on 11 November 2026, NPCI announced the UPI Vyapar Saksham Scheme, which pays banks and payment companies for installing UPI QR codes and soundboxes at small merchants and for growing the number of UPI transactions there.

The headline numbers are simple: Rs 300 for every physical QR code installed and Rs 750 for every soundbox deployed at an eligible new merchant outlet. There is one important detail, though. The money is not paid to the shopkeeper. It goes to the acquiring bank, the bank that installs the QR code or soundbox. The merchant still has to earn it: the outlet must record at least 25 eligible transactions totalling at least Rs 5,000 per month in at least two months of a quarter.

The scheme is aimed squarely at small merchants. Both new and existing small merchants with an annual turnover of up to Rs 40 lakh in the previous financial year are eligible. NPCI is focusing on Tier 3 to Tier 6 cities, the northeastern states, and the Union Territories of Jammu and Kashmir and Ladakh. In Tier 1 and Tier 2 cities, only small businesses covered by notified central government schemes, such as PM SVANidhi and PM Vishwakarma, can benefit.

There is also a reward for growing transactions. If a merchant's UPI transaction volume grows by at least 5% compared with the previous quarter, the payment provider gets an incentive of 0.03% of the eligible transaction value. In the targeted areas, that incentive gets a 50% uplift, and a further 0.20% is paid on the increase in eligible transaction value compared with the previous quarter. Only eligible payments of Rs 2,000 or less qualify, and artificially split payments are excluded.

The money for all of this comes from the new UPI merchant charge. Banks, payment service providers and UPI app operators will contribute 5% of their Merchant Discount Rate (MDR) share to a dedicated fund. The fund is split three ways: 30% for onboarding new merchants, 50% for growing transaction volumes, and 20% for incremental growth in the targeted areas, with no transfers allowed between the three parts. NPCI expects the scheme to help deploy 60 lakh to 1 crore new QR codes and 5 lakh to 10 lakh new soundboxes every year. Incentives will be calculated every quarter and processed within 30 days of a claim.

The scheme has no start date yet. It will run for three years from the date the UPI MDR takes effect, and NPCI's circular leaves that date unspecified. The charge itself is a 0.4% MDR on merchant payments above Rs 2,000, which is why the scheme can only begin once the charge begins. That charge has not started yet, as we reported yesterday. For customers, nothing changes: paying by UPI stays free for you. If you are new to UPI, our guide explains how to send money with UPI step by step.