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    Published On : Tue, Feb 7th, 2017
    Business News | By Nagpur Today Nagpur News

    Govt should incentivise digital payments tp promote usage


    Nagpur:
    In a unanimous voice more than 200 trade leaders from all over the Country at their National Conference held today at Nagpur under the banner of Confederation of All India Traders (CAIT) demanded the Government to incentivise usage of digital payments in the Country to promote its faster adoption among merchants and people. They also demanded that in order to encourage more adoption, the Government should subsidise transaction cost directly to the Banks and no such burden should be levied on traders or consumers. In a resolution adopted at the Conference, it is said that if Government support, the CAIT will make all endeavor to make Nagpur, Chandigarh and Pondicherry as Less Cash Cities on pilot project basis and later the same can be replicated to other cities. The Conference was presided by CAIT National President B, C. Bhartia.

    It is noteworthy to mention that CAIT in association with MasterCard is conducting a national campaign since last two years for education and empowerment of digital payments in India which is also supported by HDFC Bank.

    To intensify adoption of digital payments, the CAIT in association with MasterCard has launched second phase of its national campaign wherein it will hold 500 Digital Camps in commercial markets of the Country in 30 Cities in next 90 days and has set a target of on boarding 5 lakh traders on digital payment landscape.

    CAIT National President B.C.Bhartia & Secretary General Praveen Khandelwal said that removal of different kind of fees and charges on e-transactions & providing incentives for such payments, Income tax benefit to people who pay their expenditure through Debit or Credit Card and proposal to waive transaction charges for purchase of petrol, gas and rail tickets will certainly induce people to use Debit & Credit Cards more frequently.

    Both Bhartia & Khandelwal said that proposal to provide incentives to shopkeepers accepting payments in business transactions through plastic money will encourage traders to embrace e-payment system. Currently the Banks usually charge 2% on Credit Card and 1% on Debit Card transactions which discourage people to embrace e-payments. Both usage of digital payments and availability of more and more point of sales will compliment each other of more usage of payments through Cards.A scheme of discounts in VAT tax payment to Tax Departments will further encourage the people to adopt e payments in India.

    Ravi Aurora, Global Head, Public Policy of MasterCard said that India is predominantly a cash-based economy, with less than 5 per cent of Personal Consumption Expenditure (PCE) of INR 70,000 crore transacted by electronically payments. There are over 500 million debit cards – 100 million added in 2014 as a direct result of the Prime Minister’s Jan Dhan Yojana (PMJDY). But the momentum of cash is strong. Those cards are used almost entirely at ATMs rather than at the point of sale (a ratio of 10 cash transactions to 1 at the point of sale). Considering just currency, the ratio of currency to GDP in India (12.2%) is higher than countries such as Russia (11.9%), Brazil (4.1%) and Mexico (5.7%).

    He further said that the true value of electronic transactions is maximized when cards are used at the point of sale, rather than as a transaction tool to withdraw cash. Benefits flow to the entire value chain including for faster transactions and settlement, ticket lift, reduced handling costs, theft loss and counterfeit for merchants. For cardholders, more efficient payments means more in bank accounts and less in wallets, flexibility of payment options, account management and enabling purchases on the phone or the internet. For Government, the benefits are clearer still, with an enormous reduction in leakage from subsidies and support payments, increased tax revenue from a smaller grey economy and cost reductions from greater efficiency.


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