RBI governor says it’s about a nine-fold increase over the last five years
While the total volume of retail electronic payments witnessed about a nine-fold increase over the last five years, card payments continue to contribute more than half of such transactions by volume, Reserve Bank of India (RBI) governor Shaktikanta Das said on Monday.
The National Electronic Funds Transfer (NEFT) system handled 195 crore transactions valued at around Rs 172 lakh crore in 2017-18, growing 4.9 times in terms of volume and 5.9 times in terms in terms of value over the previous five years. Similarly, the number of transactions carried out through credit and debit cards in 2017-18 was 141 crore and 334 crore, respectively. Prepaid payment instruments (PPIs) recorded a volume of about 346 crore transactions, valued at Rs 1.4 lakh crore. “Thus, the total card payments, in volume terms, stood at 52% of the total retail payments during the year 2017-18,” Das observed.
Banks have been the traditional gateway to payment services, but with increasing technological changes, payments is no longer the monopoly of banks, Das said. “Non-bank entities are cooperating as well as competing with banks, either as technology service providers to banks or by directly providing retail electronic payment services. The regulatory framework has also encouraged this enhanced participation of non-bank entities in the payments domain,” he noted.
The RBI governor added that the central bank’s working group on fintech and digital banking has suggested the introduction of a regulatory sandbox or innovation hub within a well-defined space and duration to experiment with fintech solutions, where the consequences of failure can be contained and reasons for failure analysed.
“A regulatory sandbox would benefit fintech companies by way of reduced time to launch innovative products at a lower cost. Going forward, the Reserve Bank of India will set up a regulatory sandbox, for which guidelines will be issued in the next two months,” Das said.
RBI governor to meet heads of payments banks later this week Shaktikanta Das on Monday said he will be meeting heads of payments banks later this week to understand their issues.As many as seven payments banks have commenced their operations after the first set of licences were issued in 2015.
“I have started a process of very active engagement with stakeholders and players who are supposed to play these kind of roles. I have met (top officials) banks, cooperative banks, NBFCs and various other stakeholders. I met the (heads) small finance banks last week and later part of this week I am meeting payments banks also,” he said.
(With inputs from PTI)