According to Financial Express, due to the growing penetration of smartphones and high-speed internet connectivity, there has been an increased adoption of QR codes for digital payments in India.
Moreover, the report highlighted that three different types of QR codes have emerged: Bharat QR, UPI QR and Proprietary QR (closed-loop, non-interoperable). RBI recommended to phase out proprietary, closed-loop QR codes in favour of open, interoperable standards, as multiple interoperable QR codes might drive the acceptance infrastructure in coming years.
Furthermore, RBI suggested that the regulator may accept an existing bank account as a valid KYC for faster merchant onboarding. Regarding incentives to merchants accepting electronic payment, RBI stated that the government should allow a controlled interchange instead of zero MDR on QR code, UPI, or RuPay Debit card transactions, as well as give tax incentives to merchants who accept payments through electronic mode.
Consequently, the government must provide incentive schemes to ensure popularity of QR code transactions among consumers in India.
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