Digital payments need review
Laws needs to be reworked for new tech.
New Delhi: India’s digital payments market is set to touch $1 trillion within a few years and there is a need for relook at Payment and Settlement Systems Act as technology is changing at a very fast pace, principal adviser to Niti Aayog Ratan P Watal said on Tuesday.
“There has been growth momentum in volume and value terms in digital payments after demonetisation... Whether you see RBI or MEITY data, its much better than it was prior to 2016,” he said at a Ficci event.
The digital payments market In India is expected to grow to $1 trillion by 2023 led by growth in mobile payments, presenting huge business opportunities for players in the digital space, he said at the launch of Niti Aayog report — ‘Digital Payments — Trends, Issues and Opportunities.’
“Mobile payments are slated to rise from $10 billion in 2017-18 to $190 billion by 2023,” he added.
Mr Watal said however that only in 15 states, higher volume payments are digitised. He further said that the GST regime, rolled out in July last year, will have huge impact on digital payments as it matures.
“There are technological changes happening around, so you have to also start looking legislations (Payment and Settlement Systems Act),” he said ”The regulation should be such that it should allow new technology to come in very quickly. Technology also changes at a very faster pace than legislation,” he added.
Prime Minister Narendra Modi on November 8,2016 had announced demonetisation of Rs 1,000 and Rs 500 notes in a bid to crack down on black money, fake currency and corruption, with focus on pushing digital payments in a ‘less cash’ economy.
According to Watal, the growth in total retail payments in value terms has seen a three-fold increase in 2017-18 than the trend rate of the last five years — 2011-16.
“The UPI and Immediate Payment Service (IMPS) segments in terms of volume registered a spectacular growth during 2017-18. UPI, despite being a new product in the payment segment, has shown a great adoption rate among consumers and merchants,” he noted.