Ensuring secured, convenient, quick and affordable e-payment system; RBI releases vision document

Mumbai, May 16: With its core theme of ‘Empowering Exceptional (E) payment Experience’, the Reserve Bank of India has placed on its website the “Payment and Settlement Systems in India: Vision 2019 – 2021”. The Payment Systems Vision 2021 with aims at empowering every Indian with access to a bouquet of e-payment options that is safe, secure, convenient, quick and affordable.

The Payment Systems Vision 2021 has been formalised based on inputs from various stakeholders and guidance of the Board for Payment and Settlement Systems (BPSS). It envisages achieving a ‘highly digital’ and ‘cash-lite’ society through the goal posts of Competition, Cost-effectiveness, Convenience and Confidence (4Cs).

The Vision aims towards:

Enhancing the experience of Customers;

Empowering payment System Operators and Service Providers;

Enabling the Eco-system and Infrastructure;

Putting in place a Forward-looking Regulation;

Undertake Risk-focused Supervision

The ‘no-compromise’ approach towards safety and security of payment systems remains a hallmark of the Vision.

The payment systems landscape will continue to change with further innovation and entry of more players which is expected to ensure the optimal cost to the customers and freer access to multiple payment system options.

The Reserve Bank of India will implement the approach outlined in this Vision during the period 2019 – 2021. The previous Vision document covered the period 2016-2018.

The bank will implement the approach outlined in this Vision during the period 2019 - 2021. It further said that the approach of the RBI will continue to be of minimal intervention in the pricing of charges to customers for digital payments, all efforts will be made towards facilitating the operation of payment systems which are efficient and price-attractive.

The RBI said that the document talks about creating customer awareness, setting up a 24X7 helpline and self-regulatory organisation for system operators and service providers, among others.

What are the expected outcomes of Vision 2021?

• A decrease in the share of paper-based clearing as a percentage of retail payments
  
  
• Accelerated growth in individual retail electronic payment systems
  
  
• The digital payment transaction turnover vis-à-vis GDP (at market prices-current price) is expected to further increase to 10.37 in 2019, 12.29 in 2020 and 14.80 in 2021
  
  
• Increase in use of digital modes of payment for the purchase of goods and services through an increase in debit card transactions at PoS (35% increase during the vision period) and continued growth in PPI transactions.
  
  
• Usage of debit cards at PoS transactions is expected to be at least 44% of total debit card transactions (at PoS + ATM). In value terms, it is 15.2 per cent in 2018-19 (5.2 per cent in 2014-15) which is expected to be 22% by end 2021.
  
  
• Increased deployment of card acceptance infrastructure across the country including at smaller centres with a substantial portion of the infrastructure taking care of processing contactless card payments.
  
  
• Facilitation of mobile-based payment transactions as gauged on the basis of the registered customer base (expected increase of 50% considering the base effect).
  
  
• Enhanced usage of electronic payment systems is expected to reduce the marginal cost given the additional volume.
  
  
• FTS [Fraud to Sales (Fraud value / Sales value) x 10000] count for payment systems is expected to be less than 10 bps for most of the payment systems.
  
  
• Enhanced healthy competition in the payments space and establishment of new PSOs during the Vision period is envisaged.