New Delhi: NITI Aayog has launched a series of incentives for encouraging digital payments for day to day financial transactions like buying or selling goods/services, transferring money etc., at the district, taluk and panchayat level. This will include providing a fund of Rs 5 lakh per district administration.
Local administration will have to use the funds to increase the number of mobile and Aadhar cards linked to bank accounts, issue of Rupay cards and PIN numbers and download of apps. Each account will also have to undertake two successful digital transactions.
The acceptable forms of digital payments are using the Unified Payment Interface, USSD code via *99#banking, Aadhar enabled systems, Digital Wallets and Rupay/debit/credit or prepaid cards.
The top 10 districts to implement these features first will be awarded the Digital Payment Champions of India award, and the top 50 panchayats will be awarded the Digital Payment Award of Honour. It’s not clear if these awards will confer additional benefits in the form of funding etc., to encourage further digitalization.
Additionally, the Government will help set up Common Service Networks (CSE) in these areas to help people and merchants to go cashless, with the Ministry of Electronics and Information Technology offering a cash incentive of Rs.100 to every merchant that will enable digital payments. Two people have been assigned to each district collectorate to co-ordinate the CSE in each district.
The Government has increasingly started pushing for acceptance of digital payments as it has failed to replace notes in equivalent numbers, post demonetization, for users to transact offline with. However, it’s worth noting that POS terminals across the country have been overburdened during this period with the additional load on machines, and first time users haven’t had the best experiences.
While demonetization is also an opportunity to take debit card usage beyond just ATM withdrawals, adequate care must be taken to ensure that failing transactions do not put off new users from using digital payments in the future.