The rise in the prevalence of digital payments

Mumbai, Ta. 25 February 2020, Tuesday

Cash is still king in India but the trend towards digitization is also increasing, according to an internal study by the Reserve Bank of India. The high proportion of cash in currency compared to the country's GDP provides an indication that consumers are more likely to prefer cash for payments.

On the basis of this fact, Indians still prefer cash payments. Demonetisation and proactive growth of GDP reduced cash in circulation to 8.5% in 5-7 compared to the country's GDP at 5-7 but in subsequent years, it increased to 8.5% in 5-7 and 5.4 in 5-7. Had given up. However, in the financial year 1-3, this figure was 8.5 percent.

However, the growth rate is low, indicating that people are turning to digital from cash. During the period from October 1 to October 1, the amount of notes in circulation increased by an average of 5%.

Considering this rate, the number of notices in circulation in October 1 was expected to be Rs 5 trillion, but nonetheless, the figure stood at Rs 1.8 trillion, indicating that the trend towards digitization has increased and cache consumption has declined. Because the number of notes in circulation has been reduced by Rs 1.8 trillion.

However, the amount of cash withdrawals at ATMs has increased in the last five years. In terms of cash, India ranks after China. The cash withdrawal rate was found to be stable at 5% of GDP, the Reserve Bank's report noted.

In the last five years, cash withdrawals have increased by an average of nine per cent in terms of volume and 5 per cent in value, while the volume of digital payment transactions has increased by an average of 5 per cent and in value by 5 per cent.

Thus, as in many countries around the world, cash continues to be a means of payment in India, but the trend of digital payments is sure to increase.