The recent decision by the Government of India to bring digital payments at par with cash is a watershed moment in the creation of a truly digital India. In combination with Aadhaar and Jan Dhan Yojana, this move constitutes the most wide ranging and ambitious program for the digital transformation of the country.
India is amongst the most cash intensive cash economies in the world. India’s cash to GDP ratio is 12%, which is 3-4 times that of comparable economies like Brazil and South Africa. The cost of managing this high cash dependence is over Rs 20,000 Crores in the formal banking system and much more in the entire economy. With this strong signal, we are on our way to wean the country off its expensive and inefficient addiction to cash. Going digital will not only save the country Crores of rupees, it will also provide consumers and merchants a more secure and frictionless way of transacting.
We are confident that the government’s continued support for the digitization of payments will further fuel growth and innovation in the sector, with significant long term socio-economic benefits to the Indian economy.
