Reserve Bank of India recently Introduces Scoring System to Map Digital Payments, which is also known as the Digital Payments Index (DPI), to review digitization of payments effectively. The periodic scores will assess the performance of the digital payment industry.
Basically, the scoring system, introduced by RBI Reserve Bank of India, allows both the consumers and the stakeholders to measure the local area development in infrastructure, access, demographic and acceptance related growth with reference to widen or broaden domestic and global standards in digital payments.
The RBI Governor, Shaktikanta Das was quoted by saying that “Digital Payments in India has been growing rapidly day by day”.
The current position of India in Digital Payments
The current statistics revealed that Digital Payments in India is increasing. DPI captures the digitization of payments that reserve banks will build as well as publish a composite. The Scoring system DPI would be based on various parameters. It would reflect the deepening and penetration of several digital payment modes.
RBI also gauges over sector professions and also scans their target goals.
RBI turns to publish guidelines for setting up the Self-Regulatory Organization which is also called SRO in April 2020 only for spreading the communication mechanism between the stakeholders like Service providers, Banks, regulatory and supervisory bodies such as NPCI: National Payments Corporation of India and Reserve Bank of India RBI.
What is SRO?
The SRO stands for Self-Regulatory organization. It is a non-governmental organization (NGO) with the power to make and enforce standalone industry and professional regulations.
Payments Council of India is recently the most important industry body that fulfills in India’s Digital Payment Industry.
According to the Reserve Bank of India estimations, the total digital transactions in volume terms recorded a growth rate is 50.4 % in 2017-18 and now it is 58.8 % in 2018-19. The RBI says digital transactions are grown by 19.5 % in 2018-19. If it is compared to the growth in 2017-18 it was 22.2%.
How will the Digital Payments Index be beneficial?
DPI will be beneficial to understand the current usage of digital channels in both urban and rural areas. It is more popular among consumers, banks and all digital payment companies will get to know or understand about these channels. The mapping of digital payments will help the consumers to evolve in this digitalization world.
The initiative will enable the companies at an individual level to scale the ground level effectiveness of several programs already running in the country. The launch of the index will help the financial payments ecosystem in recognizing growth areas and improve the widespread permeation of all cashless payments.