Mumbai: With ‘cash is king, but digital is divine’ moto, the Reserve Bank of India (RBI) said Monday its endeavour will be to make digital payments a divine experience for the users after being buoyed by over Rs 3.5 lakh crore reduction in the notes in circulation (NIC) post demonetisation.
In its assessment of the progress of digitisation from cash to electronic, the RBI said while there is no accurate measure of cash payments in the country, the progress of various digital payments can be measured accurately.
Overall, the digital payments in the country have witnessed a growth (CAGR) of 61 per cent and 19 per cent in terms of volume and value, respectively over the past five years, demonstrating a steep shift towards digital payments.
“Cash still rules but is increasingly seen as a way to store value as an economic asset rather than to make payments,” the RBI said in a statement.
It further said NIC increased at an average rate of 14 per cent between October 2014 and October 2016. Assuming the same growth rate, NIC would have been Rs 26,04,953 crore in October 2019.
“NIC, however, was Rs 22,31,090 crore, indicating that digitaisation and reduction in cash usage helped reduce NIC by over Rs 3.5 lakh crore,” the central bank said. Notes in circulation are currency in circulation (CIC) minus coins in circulation.
The RBI said a large population of the country historically lacked access to personal bank accounts and credit lines. Digital payment methods have played a large role in helping them manage their personal finances leading to their being financially included,” it added.
“Speed, convenience and competition are shaping the future of payments. Our endeavour is to make digital (payments) a divine experience to the users – Cash is King, but Digital is Divine,” the study said.
PTI