With the entire focus of this new year to be able to digitize India, following are the few foundation stones that the operation rests upon.
Government joins the digital wallet revolution
In the Indian digital wallet scenario, private players have always been the disruptors of the segment. Their approach has been to completely revolutionize and kick-start a system. As the government enjoys the benefit of being the system itself, the new BHIM app will unleash mobile phone revolution. The government will introduce two schemes to promote BHIM App - referral bonus for the users and cash back for the traders which are imperative for the “less cash" economy as BHIM has surpassed all other UPI apps with around 1.25 cr downloads.
Hard war against hard cash
There have also been stringent control measures on the volume of cash transactions.
With the Income Tax Act being amended to ensure that no cash transaction above Rs 3 lakh is permitted, a limit on donations to campaigns, and a proposal to mandate all government receipts beyond a threshold this is a multi-pronged approach to address the pain points in the system.
On the common man front, there have been service tax exemptions on online transactions for Train tickets, Fuel and Point-of-Sales machines. These measures will spark a digital cash based lifestyle evolution that is unfolding in front of our eyes.
The biggest roadblocks to digitization of finance are security and perceived security. The security regulations that are in place must improve a lot to handle the fast growth of FinTech. This year, cyber-security has become a focus for with a computer emergency response team to be set up. Organizations like RBI are taking a more active role in employing security reforms. However, there needs to be stricter privacy laws and education of digital payments for the common man.
However fast we are moving towards a cashless future, there are still millions of Indians who are yet to be touched by this revolution. There has been an inclusive alternative that serves as a conduit. Aadhaar Pay is to be launched for people who don’t have mobile phones, helping them exist in the digital cash universe.
These developments in our country, along with a stellar growing fintech industry that takes us beyond leaps, the cash-less digitized India may well become a reality.