RBI Digital payments: Earlier, the Reserve Bank has announced the construction of the composite Reserve Bank of India which includes the Digital Payments Index from March 2018 as the base to capture the extent of digitalization of payments all over the country.
Now the digital payments have recorded an increase by more than 30 percent during the business year which ended on March 2021 by reflecting the adoption and deepening of the cashless transactions in the country, in the records of RBI.
As per the recently constituted Digital Payments Index of the Reserve Bank of India, the index has increased to 270.59 at the end of March 2021 from 207.84 in a year.
The Digital Payment Index of the Reserve Bank of India has significantly demonstrated the growth in the Index which represents the rapid adoption and deepening in the field of digitalization the medium of payments all over the country in recent years.
RBI Digital payments Index has compromised with five broad parameters which have been enabling the measurement of deepening and penetration of the digital payment system in the country over different periods.
The Five parameters are Payment Enablers that weigh 25 percent, Payment Infrastructure along with Supply-side factors weighing 15 percent in total, Consumer Centricity that weighs 5 percent, Payment Performance which alone weighs 45 percent in total, and Demand-side factors which weigh 10 percent.
At the beginning of the year 2021, the Reserve Bank of India stated that the Index will be going to be published on a semi-annual basis from March 2021 onwards with a lag of 4 months and the index is going to be published thrice in a single year.
RBI Digital payments, The reason behind the increase of the Digital Payment Index between March 2020 to March 2021 is the complete lockdown caused because of the COVID-19 pandemic, and people all over the country are switching to the cashless transaction and trying to use the cards, UPI’s, and digital mobile wallets such as Paytm, Phonepe, MobiKwik, Google pay, and many more which gives an individual to make digital transactions on some click to the retailer, wholesaler or any shopkeeper using the digital mode of transactions.