New Delhi: In a remarkable development for the first time in 20 years, currency in circulation declined during this year's busy Diwali week.
Innovations in technology have changed the Indian payment system over the years, and the Indian cash-led economy now has changed to a smartphone-led payment economy, said SBI Research in its latest Ecowrap report.
"The success of the digital journey is primarily due to the relentless push by the government to formalize and digitalize the economy. Further, the interoperable payments systems like UPI, Wallets and PPIs have made it simple and cheaper to transfer money digitally, even for those who don't have bank accounts," the report authored by Group Chief Economic Advisor Soumya Kanti Ghosh said.
"Over the years, the system has expanded rapidly with new innovations like QR code, NFC etc., and has also seen the swift entry of big tech firms in this industry," Ghosh added.
The rise in digital payments, the report said, is a win-win for both RBI and the government, as it results in saving of seignorage costs and also a less cash economy.
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