About 100 million people make ePayments once a month, claims Nandan Nilekani-led panel
About 100 million people make ePayments once a month, claims Nandan Nilekani-led panelAbout 100 million people make ePayments once a month, claims Nandan Nilekani-led panelPratik Bhakta This could be one of the first official acknowledgements of the total number of digitally transacting active users in India. | ET Bureau | Jun 5, 2019, 02:42PM ISTThe number of people who use digital payments at least once in a month stands at 100 million currently, according to the Committee on Deepening of Digital Payments. This could be one of the first official acknowledgements of the total number of digitally transacting active users in India. The committee has predicted the number to go up three times by 2021.
“The real figure could be anywhere between 70 and 80 million as well; even for UPI (Unified Payments Interface), the number of unique handles issued has not crossed 100 million,” said a senior banker who did not wish to be named.
The committee, formed by the RBI, was chaired by Infosys cofounder Nandan Nilekani with four other eminent professionals as members. Further, the committee has also devised a means to calculate the number of digital transactions per annum per capita. For India, it stands at 22 currently, up from 2.3 in 2014.
The committee, which made several recommendations, has been silent on the formation of a separate body to govern the digital payments ecosystem, said industry sources. The topic was much discussed when an inter-ministerial panel suggested — as an amendment to the Payment and Settlement Systems Act — taking away payments regulation from the purview of the RBI.
The banking regulator had issued a dissent note against this move, identifying payments as an integral part of the banking ecosystem which it governs.
“The committee has indicated that the regulator has facilitated a lot of innovation in digital payments, but has stayed away from the specific topic of a separate payments body,” said the banker quoted above.
Cyber security specialists pointed out that the committee could have set out more concrete recommendations on fraud prevention in digital transactions. It has suggested setting up of a fraud detection registry, periodic publishing of fraud data and preventing payment applications from running on insecure devices.
“It could have suggested risk-based authentication,” said a senior executive of a Mumbai-based payments security company. “Among other issues which need attention are increased awareness about payment council standards and severe shortfall of trained cyber security professionals.”
Major issues around merchant discount rate to push digital payments, access of non-banks to bulk fund transfer mechanisms like Real Time Gross Settlement (RTGS) and promotion of payments through feature phones are a few of its major recommendations. These, industry insiders said, would help the payments sector grow faster.
“It is up to the central bank to incorporate the suggestions into the Vision document for 2019-21, which is what the RBI will closely follow in terms of policy shifts for the future,” said a top executive of a payments company.