National Payments Corporation of India (NPCI), the umbrella organization for all retail electronic payments systems in the country, has touched a landmark number of 1 billion transactions during July this year.
The figure reflects the surge in electronic transactions which has been triggered by the shock demonetization of 500 and 1000 rupee notes by the Modi government last November.
NPCI managing director AP Hota said the 1 billion transactions pertain to all types of payments handled by NPCI from cheque clearing and ATM clearing to IMPS (immediate payment system), UPI (unified payment interface), BHIM, RuPay, POS, e-commerce and also Aadhaar based payments. There are now 12 payment systems operated by NPCI.
"Highest growth has been seen in the mobile payments and Aadhaar based payments. This change was achieved by way of adding new products to NPCI's portfolio and widening the membership of all products. The next logical target can be a billion transactions a day may be in 3 years," he added.
"NPCI has truly emerged as the powerhouse of all financial transactions in India and has joined the leagues of reputed payment institutions which process billions of transactions every month globally," Hota added. NPCI was set up in 2009 as the central infrastructure for various retail payment systems in India and was envisaged by the Reserve Bank of India (RBI) as the payment utility for all banks in the country.
DIGITAL PAYMENTS RECORDED 55 PER CENT INCREASE
According to digital payments committee chairman, Ratan Watal, digital payments recorded a 55 per cent increase in 2016-17 and the trend is likely to continue in the coming years. "Due to innovations in digital payment technologies and increasing consumer satisfaction, the growth trends in digital payments are positive and will continue to dominate the payments landscape in India," said Watal.
The government is giving a big push to digital transactions which is expected to weed out black money in the economy and has set a target of 25 billion transactions to be achieved by March 2018. Official figures show that the outstanding stock of currency in circulation, which hovered around 12 per cent of GDP during 2011-12 to 2015-16, declined to 8.8 per cent during 2016-17, reflecting the impact of demonetization partially offset by the ongoing re-monetization process. Minister of State for Finance Arjun Ram Meghwal disclosed in the Lok Sabha on Friday that the notes in circulation as on July 21 was around 86 per cent of the pre-demonetization level.
PUSH ON DIGITAL PAYMENTS
This also reflects that people are doing with less hard cash in the day to day transactions. The government has been promoting a less cash economy through a greater push on digital payments. Retail payments accounted for as much as 98-99 per cent of the total volumes as consumers see the convenience in cashless transactions.
"The payment of fuel bills at petrol pumps through the digital mode is also growing at a rapid pace as consumers are getting more familiar withe-payments," said a senior Indian Oil official . There was initially some skepticism that people would return to older habits of using cash instead of digital transactions once the supply of notes in circulation grew. However, provisional data from the RBI also shows that after falling in January and February, the value of electronic transactions still remain elevated at much higher levels than the pre-demonetization period.
There was a sharp jump in e-payments during March, which is partly attributed to last-minute tax collections and payment rush towards various income tax-saving instruments. This trend was also reflected across the various electronic payment tools such as National Electronic Funds Transfer (NEFT),prepaid payment instruments, debit and credit cards at point of sale (PoS) machines, and mobile banking.- India Today