Digital Economy – 02
Even within India, the digital divide is narrowing fast, as less affluent states leapfrog to catch up with more affluent ones on dimensions such as internet subscriber growth, density of internet infrastructure, and Common Service Centres.
On the back of rapid progress in internet infrastructure and usage, thirty digital themes can be scaled up nationally to accelerate progress in nine priority areas. The report lays out a roadmap for Digital India 2.0, and outlines the enablers required in nine strategic areas, ranging from creating 21st century IT infrastructure and software capabilities, to using digital to serve key national priorities, such as healthcare, education and energy for all, doubling farmers’ income, Make in India, next-gen financial services, jobs and skills of the future, and e-governance. These themes can help create up to $1 trillion of economic value in 2025, and empower millions of workers, entrepreneurs, small and large businesses, and consumers in rural and urban parts of the country.
India’s digital economy of the future could generate productivity and output sufficient to support 55 million to 60 million workers in 2025. Digital technologies fundamentally change work and create demand for new types of skills and job roles whichresults in further augmentation of high productivity, highly skilled jobs. Aside from digital coders and solution providers, many types of work will become digitally-enabled and necessitate workers to be trained as users of digital technologies. For example, delivery personnel and drivers in the logistics and transportation sectors, healthcare workers, or advisory service agents in areas such as financing and agriculture, will all need retraining.
Capturing the potential value of a $1 trillion digital economy will require concerted action and extensive collaboration between government and business entities. For India to achieve its full digital potential and become the digital factory of the world, cross-cutting enablers are needed, like improving ease of operations for digital businesses and unlocking the flow of capital to them, facilitating a booming open-API ecosystem, supporting digital innovators through government procurement, and strengthening centres of higher education and innovation in new and emerging technologies like AI. The report further explores steps that will enable the move from the “business-as-usual” digital trajectory that would create economic value of $500 billion to $650 billion by 2025 towards the full potential scenario where the digital economy can create economic value of $1 trillion by 2025.
DIGITAL PAYMENT SYSTEMS
National Electronic Fund Transfer (NEFT)
The initial electronic fund transfer system introduced in the late 1990s enabled an account holder of a bank to electronically transfer funds to another account holder with any other participating bank. Later in 2005, RBI has launched National Electronic Fund Transfer (NEFT) Scheme with advanced and secure features for facilitating one-to-one funds transfer requirements of individuals / corporate.
Individuals, firms or corporate maintaining accounts with a bank branch can receive funds through the NEFT system. It is, therefore, necessary for the beneficiary to have an account with the NEFT enabled destination bank branch in the country.
There is no limit – either minimum or maximum – on the amount of funds that could be transferred using NEFT. However, maximum amount per transaction is limited to Rs.50, 000/- for cash-based remittances within India.
Real Time Gross Settlement (RTGS)
RTGS provides continuous (real-time) settlement of funds transfers individually on an order by order basis (without netting). Here, ‘Real Time’ means the processing of instructions at the time they are received rather than at some later time. Similarly, ‘Gross Settlement’ means that settlement of funds transfer instructions occurs individually (on an instruction by instruction basis)
Difference between NEFT and RTGS
Under RTGS the transactions are settled individually. RTGS transactions are processed continuously throughout the RTGS business hours.
The NEFT platform is primarily aimed for small value transactions. At one transaction the maximum value should be Rs 50000.
On the other hand, the RTGS is aimed for large value transactions. The minimum amount to be remitted through RTGS is Rs 2 lakh. There is no upper ceiling for RTGS transactions.
Immediate payment services
Immediate Mobile Payment Services (IMPS) is a real time instant inter-bank funds transfer system managed by National Payment Corporation of India. IMPS is available 24/7 throughout the year. Minimum Transfer Limit is Rs. 1 and Maximum Transfer Limit is Rs. 2 lakh.
National Payment Corporation of India
National Payments Corporation of India (NPCI), an umbrella organisation for operating retail payments and settlement systems in India, is an initiative of Reserve Bank of India (RBI) and Indian Banks’ Association (IBA) under the provisions of the Payment and Settlement Systems Act, 2007, for creating a robust Payment & Settlement Infrastructure in India.
NPCI, during its journey, has made a significant impact on the retail payment systems in the country. RuPay is an indigenously developed Payment System – designed to meet the expectation and needs of the Indian consumer, banks and merchant eco-system. RuPay supports the issuance of debit, credit and prepaid cards by banks in India and thereby supporting the growth of retail electronic payments in India.