The RBI in its monetary policy statement in July had stated that benchmarking India’s payments systems was necessary to gauge India’s progress vis-à-vis payment systems and instruments in major countries and give further impetus to the planned efforts for deepening the digitisation of payments.
The benchmarking exercise of India’s payments systems was vis-à-vis payments systems in a mix of advanced economies, Asian economies, and the Brazil, Russia, India, China and South Africa (BRICS) nations. The analysis was attempted under 41 indicators covering 21 broad areas, including regulation, oversight, payments systems, payment instruments, payment infrastructure, utility payments, government payments, customer protection and grievance redressal, securities settlement and clearing systems, and cross-border personal remittances.
The report said that the relatively high level of cash in circulation offers scope for higher level of digitisation of payments. Also, the decline in cheque usage has been slow.
Growth in the volume of payments systems transactions has been strong and steady. There has also been an increase in point-of-sale terminals, including mobile terminals. However, this may not be enough to cater to a large population.
The digital payment of utility bills is very low. However, the Bharat Bill Payment System, an integrated interoperable bill payment system which commenced live operations on October 12, 2017, is expected to facilitate digital payment of utility bills like electricity, telecom, direct-to-home, gas, and water.
The report stated that digital communications infrastructure, in the form of a robust mobile network, is growing strong, but broadband infrastructure lags behind. The report also said India’s authentication standards were strong.