The Reserve Bank of India (RBI) has taken significant steps to enhance its Payments Infrastructure Development Fund (PIDF) Scheme by including beneficiaries of the PM Vishwakarma Scheme and extending the scheme’s tenure by an additional two years. The PIDF Scheme, operationalized in January 2021, initially had a duration of three years, set to end in December 2023. However, its success and potential impact led to an extension up to December 31, 2025.
The PIDF Scheme was designed to stimulate the deployment of payment acceptance infrastructure, such as physical Point of Sale (PoS) terminals and Quick Response (QR) codes, particularly in tier-3 to tier-6 centers, the northeastern states, and the Union Territories of Jammu & Kashmir and Ladakh. Beneficiaries of the PM SVANidhi Scheme in Tier-1 and 2 centers were integrated into the PIDF scheme in August 2021. As of the end of August 2023, over 2.66 crore new touchpoints have been deployed under the scheme. The recent decision to include the PM Vishwakarma Scheme beneficiaries across all centers is expected to further invigorate the RBI’s efforts to promote digital transactions at the grassroots level.
The PM Vishwakarma Scheme, launched by Prime Minister Narendra Modi in September 2023, aims to provide both financial and non-financial support to artisans. It offers collateral-free loans up to Rs 3 lakh at an interest rate of 5 percent, with a subsidy of up to 8 percent. The scheme also covers the cost of skill training, digital marketing, and branding. It encompasses artisans from 18 diverse fields, including carpenters, goldsmiths, blacksmiths, masons, stone sculptors, barbers, and boatmakers, among others. Beneficiaries initially receive a Rs 1 lakh loan, with the potential to access an additional Rs 2 lakh after a repayment schedule of 18 months. The scheme also provides access to advanced skill training, knowledge of modern digital techniques, green technologies, brand promotion, linkage with local and global markets, digital payments, and social security.
The RBI’s decision to include PM Vishwakarma beneficiaries under the PIDF Scheme is a strategic move to enable artisans to access digital payment infrastructure at an affordable cost, potentially increasing their sales and expanding their customer base. Furthermore, the RBI is also proposing to encourage the deployment of emerging modes of payment acceptance, such as soundbox devices and Aadhaar-enabled biometric devices, under the PIDF Scheme. These initiatives are set to expedite and augment the deployment of payment acceptance infrastructure in targeted regions, marking the beginning of a new phase in digital payment adoption.
Overall, the expansion of the PIDF Scheme to include PM Vishwakarma beneficiaries and the extension of its tenure by two years is expected to have a positive impact on the Indian economy. By promoting digital payments, the initiatives can help reduce transaction costs, increase transparency, and enhance financial inclusion. The growth of digital payments can also contribute to economic growth and job creation.