BACKGROUND: Inadequate intake of fruits and vegetables is prevalent in rural areas of India, where around 65% of the population reside. Financial incentives have been shown to increase the purchase of fruits and vegetables in urban supermarkets, but their feasibility and effectiveness with unorganised retailers in rural India is unclear. METHODS: A cluster-randomised controlled trial of a financial incentive scheme involving ∼20% cashback on purchase of fruits and vegetables from local retailers was conducted in six villages (3535 households). All households in three intervention villages were invited to participate in the scheme which ran for three months (February-April 2021), while no intervention was offered in control villages. Self-reported (pre-intervention and post-intervention) data on purchase of fruits and vegetables were collected from a random sub-sample of households in control and intervention villages. FINDINGS: A total of 1109 households (88% of those invited) provided data. After the intervention, the weekly quantity of self-reported fruits and vegetables purchased were (i) 18.6 kg (intervention) and 14.2 kg (control), baseline-adjusted mean difference 4 kg (95% CI: -6.4 to 14.4) from any retailer (primary outcome); and (ii) 13.1 kg (intervention) and 7.1 kg (control), baseline-adjusted mean difference 7.4 kg (95% CI: 3.8-10.9) from local retailers participating in the scheme (secondary outcome). There was no evidence of differential effects of the intervention by household food security or by socioeconomic position, and no unintended adverse consequences were noted. INTERPRETATION: Financial incentive schemes are feasible in unorganised food retail environments. Effectiveness in improving diet quality of the household likely hinges on the percentage of retailers willing to participate in such a scheme. FUNDING: This research has been funded by the Drivers of Food Choice (DFC) Competitive Grants Program, which is funded by the UK Government's Department for International Development and the Bill & Melinda Gates Foundation, and managed by the University of South Carolina, Arnold School of Public Health, USA; however, the views expressed do not necessarily reflect the UK Government's official policies.