Reserve Bank of India: Digital Payment Index (RBI)

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Reserve Bank of India: Digital Payment Index (RBI)

Reserve Bank of India: Digital Payment Index (RBI)

Reserve Bank of India Digital Payment Index- Digital Payment Index- RBI- Youth Destination Current Affairs

  • The Reserve Bank of India (RBI) has prepared drafts of the Digital Payments Index to assess the quantum of digitization in the country and the status and innovation of digital/cashless The Reserve Bank of India will publish the Digital Payments Index on a half-yearly basis from March 2021 onwards.
  • Reserve Bank executive director T. Ravi Shankar said that digital payments in India are growing rapidly, although its per capita penetration is still quite low.
  • This index will help the government to overcome the shortcomings of digital distance and digital/cashless

Main points

  • The Reserve Bank of India has set the base year 2018 of the Digital Payments Index.
  • The Digital Payments Index for the year 2019 was 153.47 and for 2020 was 207.84.

Parameters of Digital Payments Index

Five broad parameters have been incorporated in the creation of the Digital Payments Index, which will enable the accurate study of digital payments that have taken place in different periods in the country. These are:

  1. Payment Enablers (25%)
  2. Payment infrastructure – demand-side factor (10%)
  3. Payment Infrastructure – Supply-Side Factors (15%)
  4. Payment performance (45%)
  5. Consumer-centric (5%)

Data analysis: RBI – Digital Payment Index

  • According to the Worldwide India Digital Payments Report, during the second quarter (Q2) of the year 2020-21, Unified Payments Interface (UPI) recorded an 82% increase in the number of payments and a 99% increase in the total prices, which is higher than the corresponding quarter of the previous year.
  • In the second quarter, 19 banks joined the UPI system, bringing the total number of banks providing UPI service to 174 by September 2020, while the customers of 146 banks were being served by BHIM App.
  • The number of point of sale terminals deployed by merchant acquiring banks in the second quarter of the financial year 2020-21 was more than 51.8 lakh, which is 13 percent higher than the same quarter of the previous year.
  • Merchant acquiring banks are those banks that handle payments on behalf of traders/merchants.
  • In 2018, India was ranked seventh among 24 countries by the International Settlement Bank, where digital payments are tracked by the institution.

The requirement of Digital Payments Index

Digital payments have seen a boom in India. According to the Unified Payments Interface (UPI), 223 crore transactions worth about Rs 4.16 lakh crore were done in December 2020, while 221 crore transactions worth Rs 3.9 lakh crore were done in November 2020. Digital transactions in the country are increasing day by day.Digital transactions in the country are increasing day by day. Therefore, it is necessary to measure its growth and launch-related initiatives to support development.

Other surveys/reports published by the Reserve Bank of India

Consumer Confidence Survey (CCC-Quarterly)

Household Inflation Expectations Survey (IS-Quarterly)

Financial Stability Report (Half Yearly)

Monetary Policy Report (Half Yearly)

Report on Management of Foreign Exchange Reserves (Half yearly)

Source – The Hindu, PIB

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