Source: ET Bureau
The banking regulator will make the index available in the public domain from July 2020.
The Reserve Bank of India (RBI) will issue periodic scores to assess the performance of the digital payments industry on key operating parameters such as rural penetration and innovation in existing modes and channels.
Called the Digital Payments Index (DPI), the ‘composite’ scoring system will allow both consumers and stakeholders to better gauge local area developments in infrastructure, access, demographic and acceptance related growth with reference to broader domestic and global standards in digital payments. “Digital payments in India have been growing rapidly. The Reserve Bank shall construct and periodically publish a composite DPI to capture the extent of digitisation of payments effectively,” RBI Governor Shaktikanta Das said on Thursday. The DPI would be based on multiple parameters and reflect the penetration and deepening of various digital payment modes, said Governor Das. The banking regulator will make the index available in the public domain from July 2020.
“Banks and payment companies will get to know which channels are more popular among consumers. The mapping of digital payments will eventually help the end consumers evolve in the space,” said Mandar Agashe, founder and vice-chairman, Sarvatra Technologies, a technology service provider for Indian banks. “It will help to map the level of digitization across the country. It will be beneficial for us to understand the usage of digital channels in urban and rural areas.” Additionally, the central bank will also publish guidelines for setting up of a new Self-Regulatory Organisation (SRO) with a mandate to enhance the communication mechanism between payment sector stakeholders, such as the service provider and banks, and regulatory and supervisory bodies, such as the RBI and National Payments Corporation of India (NPCI). The firsts set of operating guidelines would be issued in April, RBI said.
An SRO is generally a non-governmental organization with the power to create and enforce standalone industry and professional regulations and standards. Currently, the Payments Council of India (PCI) is the largest industry body that fulfils this role in India’s digital payments industry.
“With substantial growth in digital payments and maturity gained by entities in the payment ecosystem, it is desirable to have an SRO for orderly operations of the entities in the payment system,” Das said.