Implementing a new payment infrastructure will require careful planning, patience and flexibility
In the aftermath of demonetisation, millions of Indians have switched to digital modes of payment for their daily transactions. To fuel this momentum, the Union government has announced a slew of incentives further encouraging citizens to go cashless. Shifting towards a digital payments ecosystem could generate several potential benefits: for citizens, it could reduce transaction costs and increase access to critical financial services; for governments, it could reduce leakages and improve public service delivery. While there is some evidence to support these theories, capturing these benefits in reality is not straightforward and will require a systematic, evidence-driven approach.