Table of Contents
CURRENT AFFAIR
- According to the recent Reserve Bank of India (RBI) data, the month March saw a sharp rise in digital financial transactions countrywide.
- Impact of lockdown
DETAILS
- The total value of Real Time Gross Settlement (RTGS) transactions rose by 34% across banks.
- It is the biggest online payment method offered by RBI.
- The National Payments Corporation of India (NPCI)-run United Payments Interface (UPI), registered more than 125 crore transactions in March.
- Recharges and bill payments as well as retail banking transactions, accounted for the majority of the volume of all the transactions.
- NPCI-run Bharat Bill Pay was one of the beneficiaries, as it recorded 1.58 crore transactions in March as against 1.49 crore in February.
- The usage of cash and other cash-based services dipped during the period.
- Cash withdrawals from ATMs as well as usage of various cards (debit, credit) have also gone down significantly.
- People’s requirements for cash have fallen since the spending is mainly on essentials and necessities.
- The government’s Aadhaar Enabled Payment System (AePS) also saw a decline of 16.1 % in the number of transactions, in March.
- The government uses AePS mostly for direct benefit transfer schemes.
Real Time Gross Settlement
- An electronic fund transfer method through which money is sent on a ‘real time’ basis without any delays.
- ‘Gross Settlement’ refers to the processing of transactions on an individual basis and not in a batch wise system.
- Minimum amount that can be sent via RTGS mode is Rs.2 lakh and has no maximum limit.
- RTGS is not a 24×7 facility and is available only during working hours of banks.
Unified Payments Interface
- It is an advanced version of Immediate Payment Service (IMPS)- round–the-clock funds transfer service to make cashless payments faster, easier and smoother.
- UPI is a system that powers multiple bank accounts into a single mobile application (of any participating bank), merging several banking features, seamless fund routing & merchant payments into one hood.
- National Payments Corporation of India (NPCI) launched UPI with 21 member banks in 2016.
Bharat Bill Payment System
- Driven by National Payments Corporation of India (NPCI).
- Payment of all bills
- Provides an interoperable and accessible “Anytime Anywhere” bill payment service to all customers across India
- Certainty, reliability and safety of transactions.
Aadhaar enabled Payment System
- AePS is developed by the National Payments Corporation of India (NPCI)
- Allows people to carry out financial transactions on a Micro-ATM by furnishing just their Aadhaar number and verifying it with the help of their fingerprint/iris scan.
- Funds can be transferred from one bank account to another simply through their Aadhaar numbers.
- Security to financial transactions – bank details would no longer be required to be furnished while carrying out these transactions.
National Payments Corporation of India
- Umbrella organization for all retail payments systems in India.
- It was set up with the guidance and support of the Reserve Bank of India (RBI) and Indian Banks’ Association (IBA).
- Objectives –
- To consolidate and integrate the existing multiple systems into a nation-wide uniform and standard business process for all retail payment systems.
- To facilitate an affordable payment mechanism to benefit the common man across the country and propel financial inclusion.
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