Govt to explore use of blockchain tech for ushering in digital economy

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February 02, 2021 6:14 PM

Minister of State for Finance Anurag Singh Thakur said it was announced in the Budget Speech of 2018-19 that the government does not consider crypto-currencies legal tender or coins and will take all measures to eliminate the use of these crypto-assets in financing illegitimate activities or as part of the payment system.

"The government will explore the use of the blockchain technology proactively for ushering in the digital economy," Thakur said in a written reply to a question on introduction of India's own crypto-currency.Crypto industry is open to being regulated, but a blanket ban is something that will harm the entire country’s financial and technology ecosystem.

The government will explore the use of blockchain technology proactively for ushering in the digital economy, the Rajya Sabha was informed on Tuesday.

Minister of State for Finance Anurag Singh Thakur said it was announced in the Budget Speech of 2018-19 that the government does not consider crypto-currencies legal tender or coins and will take all measures to eliminate the use of these crypto-assets in financing illegitimate activities or as part of the payment system.

“The government will explore the use of the blockchain technology proactively for ushering in the digital economy,” Thakur said in a written reply to a question on introduction of India’s own crypto-currency.

On cash circulation in the country, he said that as per weekly statistical supplement of the RBI, the Notes in Circulation (NIC) was Rs 17,741.87 billion as on November 04, 2016, and Rs 27,712.43 billion as on January 08, 2021, thereby recording an increase of 56.2 per cent in a span of around 4 years 2 months.

The growth in NIC depends on various macro-economic factors such as expected growth in GDP, inflation, interest rates, and growth in non-cash modes of payment, the minister added.

Digital payments transactions have been steadily increasing since last few years post demonetisation.
The total transaction volume increased from 2,071 crore in FY2017-18 to 3,134 crore in FY2018-19, which corresponds to a growth rate of 51 per cent, Thakur informed.

During 2019-20, the number of card payment transactions carried out through credit cards and debit cards increased by 23.5 per cent and 16.1 per cent, respectively, while the value increased by 21.1 per cent and 35.6 per cent to Rs 7.3 lakh crore and Rs 8 lakh crore, respectively.

Prepaid Payment Instruments (PPIs) recorded a volume growth of 15.7 per cent on top of the 33.2 per cent a year ago, while transactions value at Rs 2.2 lakh crore increased by little more than 1 per cent.

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