BackRBI panel for making all public payments digital
The RBI panel on digitization is also likely to press for encouraging citizens to pay income tax and challans digitallyThe panel has been asked to suggest a medium-term strategy for deepening of digital payments, measures to strengthen its safety and security and provide a road map for increasing customer confidence
PremiumNEW DELHI : A Reserve Bank of India (RBI) committee may recommend that all government payments to citizens should be made digitally, one person aware of the matter said, requesting anonymity. The move seeks to ensure higher adoption of digital payments among the masses.
The five-member panel called Committee on Deepening of Digital Payments led by former Unique Identification Authority of India chairman Nandan Nilekani was formed in January, and is expected to submit its report in May, the person added. The panel will recommend ways to encourage digitization of payments and enhance financial inclusion. “Certain states have still not completely adopted digital payments. They continue to use cash or cheques. This has to change," the person mentioned above said.
Currently, 80% of government payments to citizens are made digitally, including salaries, pensions and social security payments. Bringing the rest under the digital mode will enhance transparency and accountability, he added.
According to the person, the committee is also likely to suggest steps to encourage citizens to pay for government services, such as income-tax and challans, digitally. “This can be achieved in the next two-three years."
Besides Nilekani, the other members 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.
“Significant progress has been made on going cashless . It is important to get states and agencies on board. Acceptance of digital payments through fair price shops still remains a challenge. The progress is slow on that part," said Ashish Aggarwal, head of public policy, Nasscom.
The committee has been asked to suggest a medium-term strategy for deepening of digital payments, measures to strengthen its safety and security and provide a road map for increasing customer confidence and trust while accessing financial services through digital modes.
The panel met a couple of times and also consulted officials from the finance ministry’s department of financial services and economic affairs, telecom ministry, as well as the ministry of electronics and information technology.
The government has been trying to expand digital payments after demonetization in November, 2016, when the Prime Minister Narendra Modi scrapped ₹500 and ₹1,000 notes.
Last month, RBI governor Shaktikanta Das said much focused effort has been made in the last few years to develop national payments infrastructure. As a result, the total volume of electronic payments has soared nine times in the last five years, Das had said.
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