Demonetisation | The story so far

Govt. shifts focus on steps to boost digital transactions

Economic Affairs Secretary Shaktikanta Das.  

The government on Wednesday announced disbursal of Rs 21,000 crore to the District Central Cooperative Banks (DCCB) to ensure smooth farm operations in the current rabi season, even as it began a new phase of the demonetisation exercise and efforts to make India a less-cash economy by shifting focus on measures aimed at boosting digital transactions.

Acknowledging that farmers have been among the hardest hit due to the demonetisation move, the government said that though a special limit of Rs 21,000 crore to the DCCBs was announced, an additional limit would be sanctioned by the National Bank for Agriculture & Rural Development (NABARD) as and when required.

Economic Affairs Secretary Shaktikanta Das told reporters that a list of all DCCBs in the country and their requirements were forwarded to the Reserve Bank of India (RBI) and NABARD. The DCCBs, in turn, would provide credit to agricultural cooperative credit societies.

Mr. Das said Finance Minister Arun Jaitley had held a video conference with the RBI and NABARD and they were advised to make cash available to the DCCBs. The top priority of the government now was to ensure that there iwas no cash shortage in rural areas. Around 82,000 of the 2.2 lakh ATMs in the country had been recalibrated to dispense new currency. within a few days, the remaining ATMs would be recalibrated.

On seizures of unaccounted cash, Mr. Das said the Revenue Department would soon make a statement on the exact quantum.

E-payments incentivised

The government also announced incentives, including waiver of certain service charges till December-end, to help promote electronic payments using debit card, Internet and mobile phones.

Mr. Das said following the National Payments Corporation of India (NPCI) waiving 'switching charges' till December 31, to ensure greater usage of RuPay cards, banks -- including private ones -- and service providers have agreed to waive the service charge on use of debit cards till December-end. "This will ensure greater penetration of digital transactions. Banks will soon issue their own circulars in this regard." Also, the railways have announced that till December 31, there will be no service charge on online booking of tickets.

One of the positive outcomes of the demonetisation drive was that a large number of people have shifted to digital transactions. The public sector banks have informed the government that there was a great surge in various modes of digital payments, he said.

Mr. Das pointed out that 65 per cent of the over a billion mobile phone subscribers in the country were using feature phones (low-end affordable mobile phones that are not smart phones). Following the telecom regulator TRAI's announcement to reduce tariffs for Unstructured Supplementary Service Data (USSD)-based mobile banking transactions from the earlier rate of Rs 1.50 per session to 50 paise per transaction, telecom operators have now agreed to do away with service charges on feature phones by agreeing to waive the 50 paise charge till December 31 on such mobile phones.

New vehicles with digital tag

Also, to promote digital payments at check posts and toll plazas, the Ministry of Road Rransport and Highways had advised automobile manufacturers to make sure that all new vehicles have an Electronics Product Code Global Incorporated (EPCG)-compliant Radio-Frequency Identification (RFID) facility so that it would be easy for people to make payments digitally at such places without having to wait in long queues.

Besides, all public sector units and government agencies have been advised to use only digital payments, Internet banking, Unified Payment Interface (UPI) and aadhar-enabled payments for all the payments to employees.

Mr. Das said the government hoped that private sector companies would also make all their payments, including salaries /wages to employees/workers digitally.

In cases of transactions with private contractors or agencies, it has been made mandatory for government and its agencies to provide digital payments as an option instead of payments only through cheque or demand draft. NPCI officials said all public sector banks now have an UPI app that people can make use of to promote digital transactions. The RBI has also announced measures to boost payments through e-wallets or pre-paid payment instruments.

"For communication purposes, it is irrelevant who speaks to the media." — Economic Affairs Secretary Shaktikanta Das

Mr. Das said the RBI would release details, including on the exchange of old notes, the amount withdrawn from banks and the currency replaced. He did not state whether the government will extend the November 24 deadline for accepting notes in Rs. 500 and Rs. 1000 denomination. On challenges, including those related to violence, being faced in the Northeastern region of the country following the demonetisation exercise, Mr. Das said the security agencies concerned would address all the law and order problems in various parts of the country.

Asked why the RBI Governor Urjit Patel has not addressed the media on demonetisation and the measures being brought out by the central bank in this regard, Mr. Das said it was only important that the government and the RBI communicated to the media on a regular basis. "For communication purposes, it is irrelevant who speaks to the media. I am speaking to you on behalf of the government and not in my individual capacity," he said.

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Printable version | Jan 22, 2022 1:13:43 PM |

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