Grand Success of UPI
Digital India scheme, a dream project of our Honorable Prime Minister Narendra Modi was launched on 1 July 2015, by himself. Grand success of UPI motivates the Government in many ways. The campaign of Digital India drastically boosted the use of electronic services and products. The project is managed by a Government entity called Bharat Broadband Network Limited (BBNL).
The main objective was to improve access to technology by the people of the country. The government of India keeps on working and taking various initiatives to make this project as a very big success. One of the initiatives included a plan to connect the rural parts of the country with high-speed internet.
Objectives of Digital India – UPI
With a population of over 130 crores, India grows drastically as Digital India. Because of the Government of India’s various initiatives, citizens of the country from top cities to the village, almost every individual started using smartphones installed with UPI apps having internet connectivity at the cheapest cost. Also, many of the people adopted the digitized payment system (UPI) for their spending. It is a good sign for the country’s development also paving the way to eradicate corruption from the country.
What is mean by UPI?
Unified Payments Interface (UPI) has transformed the way of cash transactions into digital transactions. Developed by the National Payment Corporation of India (NPCI) in strategic collaboration with Reserve Bank of India (RBI) and Indian Banks Association, this mobile banking interface has been facilitating and streamlining safe and swift cashless transactions.
According to various reports, the number of UPI transactions nearly touched 300 million at the end of 2018. From small retail stores to organized, large format retail chains, merchants of all sizes can benefit from the convenience of payments directly from the bank account.
UPI is a friendly and simple technology to use. To enjoy UPI service people need a smartphone with the proper app has installed to send and receive money.
Most of the people started using this platform for the various transaction which gave grand success in the last financial year. Youngsters of the cities like Mumbai, Pune, New Delhi, Chennai, Bangalore did the maximum transactions through UPI.
Usage of UPI
Many kinds of research are done by the various organization on UPI transactions like emerging trends in digital transactions, safety, transparency, the impact of the digital economy and how to boost digital payments.
Finally, research holders found an interesting thing was there is a surprising decline in the use of plastic (Debit and credit) cards, which reduced from 61% in 2018 to 43% in the last year, as well as in net banking, which declined from 33% in 2018 to 11%.
UPI, on the other hand, saw an uptake, almost doubling from approx 19% in 2018 to 41%. Major stakeholders are Google Pay, BHIM, PhonePe and Paytm. Among them, Google Pay top in the list gained 48% of the UPI app market share, though BHIM grabbed a substantial 27% followed by PhonePe at 15%.
Senior financial consultants are said, “Significant rising number of online frauds and scams, bank account holders feel more secure using UPI”. Especially in merchant transactions, instant authentication & verification of identity and transfer of money indeed make the entire process seamless. In the case of card payments, any dispute arises during the transaction it is very difficult to find out the problem and resolving the issue. Also, it is very a lengthy process, some time it may occur loss to either one of the parties.
UPI – Preferred choice for digital Transaction
Nowadays Indian consumers are become very smart and showing much interest in digital transactions, also UPI has become the preferred choice for payments as wells as merchant transactions. Especially youngsters and techie people are widely using UPI apps as large.
“There is a phenomenal growth of 413% in digital payments (UPI) in 2018-19 is a very great achievement by Narendra Modi’s Government”. Because of the exponential growth of UPI. UPI created a new record that is UPI overtaking card payment system.
Any company or merchant if they are not adopted to the UPI system, there may be a chance they lose their existing clients. In a competitive world to meet this current situation companies and merchants are forced to adopt UPI.
Benefits of UPI for Govt and Banking System
Because of UPI, more taxpayers are increased. The government is getting more tax revenue in the form of direct and indirect tax. Obviously, the government is going to spend this additional income for public welfare schemes only. From a people’s point of view if the same trend (digital transactions) increase there may be chances of the tax burden on the public will come down.
From the Government point of view, fiscal deficit may come down from the current percentage. Also, there is a chance of Government borrowing and the cost of borrowing will come down.
Because of UPI more cash inflow will come to the banking system, based on that banks will get more benefits in many ways like their
- Lending capacity will increase,
- NPAs will come down.
- Annual profits also will increase.
- More recruitment will happen in the banking industry.
- Existing employees will enjoy a more and more secure environment and will get monetary benefits too
Youngsters and a lot of merchants are started using the UPI system. Clearly, It shows India moving towards a corruption-free economy. UPI is offered very good success to the Government of India for its Digital India Scheme.