The Reserve Bank of India (RBI), in its annual report 2022-23, stated its plan to roll out a lightweight and portable payment system.
The banking regulator argues that the current conventional payments systems such as the RTGS, NEFT, Unified Payments Interface are designed to handle large volumes but they are dependent on complex wired networks.
Natural calamities and war, therefore, can render these payment systems temporarily unavailable by disrupting the underlying information and communication infrastructure.
With this in backdrop, the Reserve Bank has conceived a lightweight and portable payment system that will be independent of conventional technologies and can be operated from anywhere with a bare minimum staff.
It is likely to operate on small hardware and software and would be made active only on a need basis. It would process transactions that are critical to ensure stability of the economy such as government and market related transactions.
“Having such a resilient system is also likely to act as a bunker equivalent in payment systems and thereby enhance public confidence in digital payments and financial market infrastructure even during extreme conditions,” reads RBI’s annual report 2022-23.
To widen the UPI’s scope
The RBI also stated that the Unified Payment Interface (UPI) has emerged stronger and more resilient from the pandemic, partly due to the wave of digital transformation. Transactions routed through digital modes recorded a marked expansion in 2022-23 over and above the strong growth witnessed a year ago.
In 2022-23, total digital payments recorded growth of 57.8 per cent and 19.2 per cent in volume and value terms, respectively, on top of growth of 63.8 per cent and 23.1 per cent, respectively, in the previous year.
India outpaced other nations to emerge as the largest player in real-time transactions at the global level, with a 46 per cent share in 20222.
The strong penetration and growth in Unified Payments Interface (UPI) were buoyed by rapid merchant onboarding, growing digital awareness and policy thrust on continuous enhancements in the scope and reach of payment systems.
Sovereign green bonds
The report also highlights the popularity of sovereign green bonds in the past one year. The total issuance of sovereign green bonds during 2022-23 was kept at ₹16,000 crore with issuance spread over two tranches of ₹8,000 crore each on Jan 25, 2023 and Feb 9, 2023 comprising 5-year and 10-year SGBs for ₹4,000 crore in each tranche, states the reports RBI’s annual report.
