NPCI – Driving India cashless

A few years back, being cashless was scary. Today, being cashless gives a sense of security and confidence.

Need to transfer money for a service availed or a product purchased and realising that you are out of cash in your wallet was once a valid reason to drive you crazy. But not anymore, when that incoming message that you’re “Transaction successful” as the preferred alternative payment method surely relieves your heart.

When we look back at the older picture of the Indian economy, a cashless India or one with minimum or lower cash transactions seems to be unreal. But with the recent demonetisation drive and the Government’s all out initiative for a digital driven economy, the clear indicative signs are that cashless is not very far.

National Payments Corporation of India has been the pioneer in fast forwarding India into the digital age since its inception in 2010. With a host of digital services launched every year, NPCI has been steadfast in its mission of touching every Indian with one or other payment services by 2020.

Incorporated as a not for profit organisation under the provisions of Section 25 of the Companies Act, 1956 (now Section 8 of the Companies Act, 2013), NPCI is dedicated in its efforts to touch every Indian digitally in its endeavour of creating a cashless economy where all the transactions carried out between two persons will occur only through payment gateways or through plastic money.

NPCI has pioneered non-cash transactions through mediums such as banking cards, UPI, USSD, NFS, CTS, AEPS, BHIM and such other mobile wallets, pre-paid cards, debit and credit cards, Internet Banking and Mobile Banking, thus reducing the economy’s dependence on cash for the betterment of the country and the economy.

Importance of a cashless economy:

The importance of a cashless economy, which is manifold, cannot be undermined.

Transactions become more convenient for everyone as there would be no requirement of carrying the bulk of cash in the wallet.

The incidences of tax evasion and money laundering will drastically reduce.

Every unrecorded transaction will get recorded in the economy paving way for India to be one of the fastest growing economies in the world.

It will weed out the counterfeit currency notes completely thus bringing the parallel grey economy to a complete standstill.

It will help in reducing the taxes as money will really fall into the welfare schemes for which it is intended.

Lastly, it would give a fillip to the economy and help in reducing taxes, by doing away with the massive annual cost of printing currency notes for the Government.

Way forward by NPCI:

With the vision to be the best payments network globally, NPCI has understood the need of different requirements of the different mediums present in the various digital transactions with the host of services and products that they offer:

RuPay Banking Card: Available in three categories of credit card, debit card and prepaid card, it provides universal access to payment systems, issued by almost all major Banks, and accepted across all major PoS and online merchants in the country.

United Payment Interface (UPI): With just the need of a bank account with your mobile number linked to it, UPI powers multiple bank accounts into a single mobile application merging several banking features, seamless fund routing and merchant payments into one hood. With these features, it makes money transfer as easy as sending a text message.

Bharat Interface for Money (BHIM): BHIM is the most simple and secure way to make payments with 24x7x365 access. It allows direct bank to bank account transfer using mobile number or UPI ID or Aadhaar Number or the Account Number and IFSC.

Unstructured Supplementary Service Data (USSD) – *99#: Enabled to work without internet, this USSD service takes banking service to every common man across the country enabling transactions to be conducted in 12 regional languages including English. By just dialling a common number across all Telecom Service Providers, *99#, transactions can be conducted through an interactive menu displayed on the mobile screen.

Immediate Payment Service (IMPS): A revolution in banking transactions, IMPS enables transfer of money instantly through Banks and RBI authorised financial entities with real time service available round the clock. With facility to operate through mobile or internet using either of the three options of Account Number and IFSC, Mobile Number and MMID or Aadhaar Number, it facilitates fund transfer within the country as well as Foreign Inward Remittance.

BHIM Aadhaar: A virtual extension of BHIM, this is a common mobile App which allows merchants to accept payments for the goods and services by just authenticating the customer’s biometrics. The money gets instantaneously transferred from the customer’s Bank account to the merchant’s Bank account.

Aadhaar Enabled Payment System (AEPS): With just the requirement of having a bank account with the Aadhaar information linked to it, AEPS virtually turns your Aadhaar into an ATM Card. It is an absolutely interoperable system allowing customers of any bank to transact on payment infrastructure laid out by other banks.

Bharat QR: A completely secure and fast payment mode at merchant outlets, Bharat QR enables customers to scan the QR code at the outlet using your Bank’s App to pay for the goods and services.

National Automated Clearing House (NACH): Creating just one system for the entire banking system in the country by consolidating multiple ECS running across the country has been the objective of NACH. With bulk payments centralised, on-time and hassle free, the feature covers the entire banking geography irrespective of a branch location.

National Electronic Toll Collection (NETC): With a view to take care of clearing and settlement of electronic toll transactions interoperable across 350+ toll plazas of NHAI across the country, this provides a complete solution of clearing and settlement of electronic toll transactions. NETC not just ensures cashless and hence non-stop vehicular movement through the toll plazas, it also provides for dispute management and a Mapper for capturing vehicle details.

Bharat Bill Pay Services (BBPS): Conceptualised by RBI and implemented by NPCI, BBPS provides a one-stop interoperable and accessible bill payment platform to all customers across the country to pay any bills “Anytime Anywhere” with utmost ease, certainty, reliability and safety of transactions.

National Financial Switch (NFS): The NFS ATM network enables customers to use any Bank’s ATM to withdraw money from their Bank Account, connecting the ATMs in the country facilitating convenient banking for the customer. The Interoperable Cash Deposit (ICD) service introduced by NPCI last year allows any participating Bank’s cash deposit machine to enable customers to deposit cash into their own account or any third party account as per their convenience. For the participating banks, it will substantially reduce their cash handling cost.

Cheque Truncation System (CTS): The CTS system fast forwards your cheque clearing process herein only an electronic image of the cheque is transmitted to the drawee bank by the clearing house along with the relevant information over a secured network. The settlement of CTS is based on the MICR data captured from the cheques thus replacing the physical movement of cheques from banks to the clearing houses.

The fast forward future of Digital India:

With NPCI paving the way to make every Indian a part of Digital India, the future of a cashless India looks very promising.

This giant leap will result in transparency in economy achieved through e-commerce transactions and digital payment gateways. With increase in the GDP of the economy and rise in investments as signs surely seen on the horizon, NPCI’s step of fast forwarding India into a digital age is truly going to create ripples of great success.

It’s time we join hands to be part of a better, developed, digitally equipped and cashless India together.


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