While India has already been lauded by Google for work done in revolutionising digital payments in the country, the government must now set another ambitious target for itself — crossing a billion digital payments a day. "Digital payment transactions on the Universal Payment Interface (UPI) platform rising from 0.1 million in October 2016 to 1.3 billion in January 2020 represents the magic of entrepreneurs, nonprofits and policymakers working together. And gives us a new target — a billion transactions a day," Manish Sabharwal and Deepak Phatak, chairman of Teamlease services and Ltd and chair professor at IIT Bombay respectively, wrote in The Indian Express.
Indian regulators, who usually follow the models of global firms and diplomats, were in for a surprise two months back when Google sent a letter to the US Federal Reserve asking them to learn from India's big leap in digital payments. For a country that had only 17% of its citizens enrolled in formal banking system in 2011, India got about 80% of its citizens under banking system by 2018 even when The World Bank had earlier suggested that it would have taken 50 more years for 80% of Indians to get a bank account had the country been at the pre-2011 speed.
"Yet, we reached that milestone in 2018. How? A magical combination of political will (Jan Dhana Yojana and Aadhaar embedding), a proactive central bank (creating a non-profit market participant entity and leveling the playing field between non-banks and banks), and a technology stack with three layers (identity, payments, and data)," Manish Sabharwal and Deepak Phatak wrote.
However, there is still more work to be done. From implementing the suggestions of the Nandan Nilekani Committee to getting a deadline in process for digitising all its payments, the central bank can go a long way for scaling up India's digital revolution. Further, it must also look into making UPI and RuPay fit for use in inward remittances as the same is pegged at $70 billion, Manish Sabharwal and Deepak Phatak wrote.