On 8 November, the Reserve Bank of India (RBI) announced a slew of measures to promote digital payments in the country. This includes, greater push to interoperable payments systems, waiving off the National Electronic Funds Transfer (NEFT) charges, expanding the use cases for QR code, adding more features to Unified Payments Interface (UPI), among others.
The move is a part of RBI’s continued efforts to accelerate the adoption of cashless payments in the country.
In September, the Central Bank expanded the scope of Bharat Bill Payment System (BBPS) by permitting all categories of billers (except prepaid recharges) who provide for repetitive bill payments on a voluntary basis. BBPS, an interoperable platform for recurring bill payments, currently covers five segments viz., direct-to-home (DTH); electricity; gas; telecom; and water bills. With the new move, repetitive bill payments such as school fees, insurance premiums and municipal taxes may also get included within the ambit of BBPS.
The Reserve Bank had also modified the NEFT timings to make it a 24×7 facility in August.
According to RBI, digital payments constituted a high 96% of total non-cash retail payments during the period October 2018 to September 2019. During the same period, NEFT and UPI systems handled 252 crore and 874 crore transactions with year on year growth of 20% and 263%, respectively. This rapid growth in the payment systems, inter-alia, has been facilitated by a series of measures taken by it.
New measures announced by RBI to empower every citizen with an exceptional payments experience:
- Mandate banks not to charge savings bank account customers for online transactions in the NEFT system with effect from January 2020.
- Operationalise the Acceptance Development Fund to increase acceptance infrastructure with effect from January 1, 2020.
- Constitute a Committee to assess the need for plurality of QR codes and merits of their co-existence or convergence from both systemic and consumer viewpoints.
- Permit all authorised payment systems and instruments (non-bank PPIs, cards and UPI) for linking with National Electronic Toll Collection (NETC) FASTags. Going forward, this will facilitate the use of FASTags for parking, fuel, etc., payments in an interoperable environment.
- Enable processing of e-mandates for transactions through UPI.