Explain India's strong growth in digital payments and what can be done to take it to rural India? | RBI Grade B Phase 1 Preparation - Bank Exams PDF Download

Explain India's strong growth in digital payments and what can be done to take it to rural India?

India is now one of the largest and fastest-growing marketplaces for digital technologies, with more than 600 million internet users. Regarding its digital banking sector, India has had a promising start to the year 2021. Particularly since the COVID pandemic, which has profoundly influenced the rise of digital payments, there has been a change in consumer payment behavior. Transaction volume and dollar volume have both increased. An 88% increase has been observed in the UPI transactions as compared to September 2019. Not only UPI but other digital modes of payment like the RTGS, NEFT, IMPS, credit and debit cards have also seen a sharp rise. Out of all these, UPI transactions alone contributed 49.1% of the total transactions. It has been observed that even after the markets have opened, people are not looking at going back to the traditional methods of payments as they have gotten completely used to digital payments. This is further going to increase as the festival season comes near with credit card transactions picking up.
Despite all these accomplishments, it is important to remember that India's rural population, which makes up 66% of the country's population and produces more than 46% of its GDP, is where the country's heart truly lies. 99% of people in metropolitan regions have access to the internet, whereas only 33% of people in rural areas do.Tapping into this seeing it as an opportunity can emerge as a silver lining for the country. The government had started paying attention to the financial inclusion and many schemes like the Digital India Mission have now become household names. The Bharatnet project has also been launched with an aim to bolster the Digital India Mission. Pradhan Mantri Gramin Digital Saksharta Abhiyan has been targeted towards making six crore Indians residing in rural India digitally literate. Start-ups like Jai Kisan and FIA technology are bridging the digital gap in rural India by offering financial products and services. Paytm has also expanded its services and claims to have a presence in more than 3 lakh villages across India. A little effort towards making digital payments look friendly and secure should be made as the it is difficult to trust anything new with money!