Digital payment industry body Payments Council of India (PCI) on Friday suggested Nandan Nilekani-headed RBI Committee on Deepening of Digital Payments (CDDP) to allow NBFCs (non-banking financial company) issue credit cards (physical or digital). The suggestion was part of a presentation made by over 100-member strong PCI to CDDP to drive payments-led financial inclusion in India.
Credit card is one of the most critical instruments for the growth of digital payments in India. Hence the council is betting big on the credit card issuance framework by NBFCs, PCI said in a statement.
The market for credit card growth remains untapped even as the credit bureau has more than 400 million customer records while around 40 million credit cards have been issued so far.
Th council’s chairman Vishwas Patel also asked for formation of a KYC bureau for the entire payments system and access to digital KYC framework along with having an interoperable KYC infrastructure.
“This is to improve customer acquisition cost across payment services besides avoiding cost duplication,” said Patel.
Further, PCI suggested that end customers should have the choice of deciding the level of KYC for payment transactions based on their frequency of online payments, convenience and risk appetite.
Despite the growth of digital payments in India cash still reign supreme. Hence the council asked CDDP to let all the digital platforms particularly PPIs seamlessly issue and allow payments along with remittance transactions below Rs 50,000 with just mobile-based KYC to grow at par with cash-based payments.
Highlighting India’s digital growth ahead, PCI’s Chairman Emeritus Naveen Surya said that, “Cash still reigns supreme and to digitize the cash use in the country we need to build a robust digital payments ecosystem besides enhancing customer faith in the industry.”
PCI suggested formation of an independent security standard or certification to secure online payment systems to enhance customer trust. It also asked for a framework wherein payment service providers can share fraud related data with an independent body for better vigilance and controls.
The council also asked the committee for “GST tax exemption in services including domestic remittance, import duty on point-of-sale terminals etc., to boost investment and reach out to more people in the middle and bottom of the pyramid,” said Patel.