Digitization of payments system comes in handy at crunch time | Mint
Active Stocks
Tue Feb 27 2024 09:58:34
  1. State Bank Of India share price
  2. 759.35 0.05%
  1. Sun Pharmaceutical Industries share price
  2. 1,560.10 0.20%
  1. Tata Steel share price
  2. 143.05 0.32%
  1. Power Grid Corporation Of India share price
  2. 290.65 1.01%
  1. Tata Consultancy Services share price
  2. 4,069.05 1.72%
Business News/ News / India/  Digitization of payments system comes in handy at crunch time

Digitization of payments system comes in handy at crunch time

New-age digital payment modes such as UPI are playing a crucial role in maintaining social distancing
  • As on 13 April, over 320 million beneficiaries had been given cash support through DBT, amounting to ₹29,352 crore
  • Photo: MintPremium
    Photo: Mint

    NEW DELHI : The digitization of the payments system, and the coming together of the Jan Dhan-Aadhaar-Mobile (JAM) trinity, in the last six years have not only pushed the government’s financial inclusion agenda, but also come in handy during the coronavirus pandemic.

    New-age digital payment modes, such as Unified Payments Interface (UPI), Aadhaar-Enabled Payment System (AePS) and Bharat Bill Payment System (BBPS), are playing a crucial role in maintaining social distancing, while ensuring seamless cash transfer to beneficiaries under the recently announced Pradhan Mantri Garib Kalyan Yojana (PMGKY).

    Official data shows that as on 13 April, more than 320 million beneficiaries had been given cash support through direct benefit transfers (DBT) amounting to 29,352 crore, which is part of the 1.7 trillion PMGKY package, announced by the finance ministry on 26 March to help the poor battle the impact of covid-19.

    Out of 29,352 crore, 9,930 crore has been transferred to Jan Dhan account holders of 198.6 million poor women—the first instalment of 500 each. As part of the government’s financial inclusion plan, Pradhan Mantri Jan-Dhan Yojana was launched in 2014 to provide bank accounts to the unbanked. As on 1 April, 380 million accounts had been opened under the scheme.

    “Fintech and digital technology have been employed for swift and efficient transfer to the beneficiary. Direct benefit transfer, i.e., transfer that ensures that the amount is directly credited into the account of the beneficiary, eliminates leakage and improved efficiency has been employed. This has also ensured credit to the beneficiary’s account without the need for the beneficiary to physically go to the branch," the finance ministry said.

    The government has pushed digital payments as a tool for economic development, as it is fast, cost-effective and increases transparency and accountability, thereby reducing corruption.

    “These are the times when people are not supposed to touch anything and maintain social distancing. In such uncertain times, Jan Dhan, Aadhaar and mobile-based transactions have turned out to be a blessing," said Madan Sabnavis, chief economist, CARE Ratings.

    Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

    Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Check all the latest action on Budget 2024 here. Download The Mint News App to get Daily Market Updates.
    More Less
    Published: 15 Apr 2020, 01:40 AM IST
    Next Story footLogo
    Recommended For You
    Switch to the Mint app for fast and personalized news - Get App