NPCI Notifies UPI Vyapaar Saksham Scheme for Small Merchants

The National Payments Corporation of India (NPCI) notified the UPI Vyapaar Saksham Scheme in a circular dated November 11, 2026, for all UPI members, as per CNBCTV18 news report.  

Funded from the merchant discount rate (MDR) collected on UPI, the scheme supports physical QR code and soundbox deployment alongside transaction linked incentives for 3 years from the UPI MDR implementation date. 

Eligible Merchants and Fund Allocation Structure 

The scheme targets small merchants with an annual turnover of up to ₹40,00,000 in the previous financial year across Tier 3 to Tier 6 centres, the North Eastern states, Jammu and Kashmir, and Ladakh, while Tier 1 and Tier 2 merchants qualify if covered under notified schemes like PM SVANidhi and PM Vishwakarma.  

Only transactions of ₹2,000 or less qualify. Each issuing bank, acquiring bank, payer PSP, and UPI app provider will contribute 5% of its eligible MDR share to the fund, divided into 3 non transferable components.  

Component A allocates 30% for new merchant onboarding, offering ₹300 per QR code and ₹750 per soundbox upon 25 eligible transactions in 2 months of a quarter and ₹5,000 monthly value.  

Component B allocates 50% for transaction growth at 0.03% of eligible transaction value with a 50% extra incentive in targeted geographies, while Component C allocates 20% at 0.20% of incremental value in targeted geographies. 

Deployment Targets and Audit Safeguards 

NPCI targets 60,00,000 to 1,00,00,000 new physical QR codes and 5,00,000 to 10,00,000 new soundboxes annually, alongside 30% to 50% yearly growth in transaction volumes for existing small merchants.  

Incentives will be calculated quarterly and settled within 30 days of claim submission. Acquiring banks must get claims certified by internal and external auditors, and devices funded by institutional mechanisms such as NABARD are excluded from claims. NPCI will review the scheme every 6 months. 

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Conclusion 

NPCI notified the 3 year UPI Vyapaar Saksham Scheme on November 11, 2026, funded by a 5% MDR share across 3 components of 30%, 50%, and 20% for merchants with turnover up to ₹40,00,000 and transactions up to ₹2,000. 

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