New Delhi: The Reserve Bank of India (RBI) on Tuesday constituted a high-level committee headed by former chairman of the Unique Identification Authority of India (UIDAI) Nandan Nilekani to set up a robust digital payments ecosystem in the country.
The committee has been asked to review the existing status of digitization of payments, identify gaps in the ecosystem and suggest ways to plug them.
According to its terms of reference, the panel has to suggest a medium-term strategy for deepening digital payments, and measures to strengthen safety and security.
“The committee shall submit its report within a period of 90 days from the date of its first meeting," the RBI said.
“Looking forward to working with the @RBI and the committee to re-imagine payments for India and Indians!," tweeted Nandan Nilekani hours after RBI’s announcement.
Besides Aadhaar architect Nilekani, the other members of the panel are former RBI deputy governor H.R. Khan, former managing director and chief executive officer (CEO) of Vijaya Bank Kishore Sansi, former secretary in the ministry of IT Aruna Sharma and chief innovation officer at the Center for Innovation, Incubation and Entrepreneurship, IIM Ahmedabad, Sanjay Jain.
The terms of reference also include: “To undertake cross country analyses with a view to identify best practices that can be adopted in our country to accelerate digitization of the economy and financial inclusion through greater use of digital payments."
The panel has also been tasked with the responsibility of increasing customer confidence and trust while they access financial services through digital modes.
Vishwas Patel, chairman of Payments Council of India (PCI), the industry body that represents digital payments companies, welcomed the move and said that all the members of PCI will actively work with the new committee in driving digital payments in the country.
“It is a great step to get specific experts who understand the payments space to identify the issues and give suggestions on what should be done. Each of these five members have already contributed well in this space and will continue to do so," he said.
The promotion of digital payments has been one of the primary agendas of the government in the past four years.
Payments through all electronic forms such as debit and credit cards, mobile wallets, real-time gross settlement (RTGS), national electronic funds transfer (NEFT) and Unified Payments Interface (UPI) have seen a huge rise over the last few years, especially since the government’s demonetization exercise in November 2016.
The newest mode of digital payments, UPI, which was launched in 2016 has witnessed an over 300% rise in transaction volumes in the last year and the growth is seen continuing in the near term.
A record 620.17 million UPI transactions worth just over ₹ 1 trillion were conducted in December, as compared to 524.94 million transactions valued at ₹ 82,232.21 crore in November—an 18% increase in transaction volume, data from the National Payments Corporation of India (NPCI) showed.