Lok Sabha Question No. 2939 (UNSTARRED), answered on 2019-07-10
Subject: Digital Transaction
Ministry: ELECTRONICS AND INFORMATION TECHNOLOGY
Asked by: Sunil Kumar Mondal, Hemant Tukaram Godse

## GOVERNMENT OF INDIA MINISTRY OF ELECTRONICS AND INFORMATION TECHNOLOGY

## LOK  SABHA UNSTARRED QUESTION NO. 2939

TO BE ANSWERED ON: 10.07.2019

## DIGITAL TRANSACTION

## 2939   :

SHRI SUNIL KUMAR MONDAL: SHRI HEMANT TUKARAM GODSE:

Will the Minister of ELECTRONICS & INFORMATION TECHNOLOGY be pleased to state: -

- (a) whether there has been a noticeable increase in the use of the digital payments in the country since demonetization and if so, the details thereof along with the volume and percentage of digital transactions during each of the last three years
- (b) whether the said growth in digital transactions has met the target fixed by the Government in this regard, if so, the details thereof and if not the reasons therefor;
- (c) whether  the  Government  has  conducted  any  comparative  study  on  the  digital  transactions carried out across the world and if so, the details and the findings thereof, country-wise;
- (d) the steps taken by the Government for ensuring safe and secure digital transactions; and
- (e) the  measures  taken/being  taken  by  the  Government  to  incentivise  digital  transaction  and promote digital economy/ literacy, especially in rural regions of the country?

## ANSWER

## MINISTER OF ELECTRONICS AND INFORMATION TECHNOLOGY (SHRI RAVI SHANKAR PRASAD)

(a):  Yes,  Sir.    There  has  been  a  significant  increase  in  the  use  of  the  digital  payments  in  the country  since  demonetization.  The  details  in  terms  of  volume  and  percentage  of  digital transactions during each of the last three years are as mentioned below in Fig 1 .

| Financial Year (FY)              | Total Digital Transactions   | Year on Year Growth% of Digital transactions   |
|----------------------------------|------------------------------|------------------------------------------------|
| FY 2016-17                       | 1013 crores                  | -                                              |
| FY 2017-18                       | 2070.39 crores               | 104.38%                                        |
| FY 2018-19                       | 3133.58 crores               | 51.35%                                         |
| FY 2019-20 (till 30 th Apr 2019) | 313.05 crores                | -                                              |

## Fig 1

- (b):    Government  of  India  has  set  target  for  Digital  transactions  from  FY  2017-18  onwards. Yearwise achievement alongwith targets is as mentioned below in Fig 2 :

| Financial Year(FY)   | Target for Digital Transaction   | Total Digital Transactions   |
|----------------------|----------------------------------|------------------------------|
| FY 2017-18           | 2500 crores                      | 2070.39 crores               |
| FY 2018-19           | 3013 crores                      | 3133.58 crores               |
| FY 2019-20 (till     | 4019 crores                      | 313.05 crores                |

Fig 2

| Financial Year(FY)   | Target for Digital Transaction Total Digital   | Transactions          |
|----------------------|------------------------------------------------|-----------------------|
| Apr 2019)            |                                                | (till 30 th Apr 2019) |

FY data for 2018-19 shows that government surpassed the target set for Digital payments and data for FY 2019-20 also shows a positive trend.

- (c):  The Reserve Bank of India has undertaken an exercise of benchmarking India's Payment Systems vis-à-vis payment systems in comparable, Asian economies and BRICS nations. The analysis  was  attempted  under  41  indicators  covering  21  broad  areas  including  regulation, oversight,  payment  systems,  payment  instruments,  payment  infrastructure,  utility  payments, Government payments, customer protection and grievance redressal, securities settlement and clearing systems and cross border personal remittances. The study found that India has a strong regulatory system and robust large value and retail payment systems which have contributed to the  rapid  growth  in  the  volume  of  transactions  in  these  payment  systems.  There  has  been substantial growth in e-payments by Government and also in digital infrastructure in terms of mobile networks.
- (d):  Government of India has taken several steps to ensure safe and secure digital transactions. The details are placed in Annexure 1
- (e):     In order to promote Digital payments ecosystem in the country, Government has taken several steps to:
1. To incentivize the digital transactions  2.  To promote the Digital economy and
3. To promote digital literacy among the citizens in rural areas.

The details of each part is as mentioned below:

## 1: Incentivization of Digital transactions:

- I. Lucky Grahak Yojana for consumers & Digidhan Vyapar Yojana for  merchants: Soon after Demonetization, Government of India launched two schemes: Lucky Grahak Yojana  for  consumers  &  Digidhan  Vyapar  Yojana  for  merchants  that  were  running  till April 2017. The primary aim of these schemes was to incentivize digital transactions so that electronic payments are adopted by all sections of the society, especially the poor and the middle class. These were designed keeping in mind all sections of the society and their usage patterns.
- II. Referral Bonus Scheme for individuals & Cashback Scheme for merchants :  As  per budget  announcement  for  FY  2017-18  and  in  order  to  encourage  citizens  to  undertake digital  transactions  through  use  of  BHIM-UPI  (Bharat  Interface  for  Money-Unified Payments  Interface)  platform,  Government  of  India  launched  two  schemes  BHIM Cashback  scheme  for  Individuals  &  BHIM  Incentive  Scheme  for  Merchants,  that  were operational till June, 2018 & March 2019 respectively.
- III. BHIM  Aadhaar  Merchant  Incentive  scheme :  In  order  to  encourage  Aadhaar  based biometric  transactions  at  merchant  locations,  the  Government  of  India  introduced  a

scheme called 'BHIM Aadhaar Merchant Incentive Scheme' in FY 2017-18 that ran till 31 st March, 2019.

- IV. Enablement of  Merchants  on  BHIM  App: In  order  to  increase  the  Digital  payments acceptance infrastructure at merchant end on PAN India basis, government launched the incentive  scheme  supporting  banks  to  onboard  merchants  subject  to  certain  terms  and conditions. The scheme is valid upto 30 th September, 2019.

## 2:   Promotion of Digital economy:

Measures  taken/being  taken  by  government  to  promote  digital  economy  are  mentioned  in Annexure II .

## 3:   Scheme for digital literacy in rural India:

## I. Pradhan Mantri Gramin Digital Saksharta Abhiyan (PMGDISHA) :

The Government of India has approved a scheme titled 'Pradhan Mantri Gramin Digital Saksharta Abhiyan (PMGDISHA)' to usher in digital literacy in rural India by covering 6 crore  rural  households  (one  person  per  household)  by  31.03.2020.  To  ensure  equitable geographical  reach,  each  of  the  2,50,000  Gram  Panchayats  across  the  country  are registering  an average of 200-300 candidates.

Special  focus  of  the  said  Scheme  is  on  training  the  beneficiaries  on  use  of  Electronic Payment  System.  The  outcome  measurement  criteria  include  undertaking  at  least  5 electronic  payments  transactions  by  each  beneficiary  using  UPI  (including  BHIM  app), USSD, PoS, AEPS, Cards, Internet Banking.

The  total  outlay  of  the  above  Scheme  is  Rs.  2,351.38  Crore  (approx.).  It  is  being implemented as a Central Sector Scheme by the Ministry of Electronics &  Information Technology through an implementing agency namely CSC e-Governance Services India Limited, with active collaboration of all the State Governments and UT Administrations.

The  Implementing Agency of the Scheme has so far conducted 90 state level workshops and 894 district level awareness workshops for the training centres. As on 04th July, 2019, more  than  2.31  crore  candidates  have  been  enrolled  and  around  2.21  crore  have  been trained,  out  of  which  more  than  1.35  crore  candidates  have  been  certified  under  the PMGDISHA Scheme.

## II. Digital Financial Inclusion Awareness and Access (DFIAA):

The DIFFA scheme was initiated in November 2016 under the Digital Saksharta Abhiyan (DISHA) for conducting awareness sessions on digital finance options available for rural citizens  as  well  as  enabling  various  mechanisms  of  digital  financial  services  such  as Unstructured  Supplementary  Service  Data  (USSD),  Unified  Payment  Interface  (UPI), Cards/Point of Sales (PoS), Aadhaar Enabled Payment System (AEPS) and e-Wallet etc. Under this programme, more than 2 crore beneficiaries and more than 27 lakh Merchants were trained/enabled. In addition, sensitization drives were carried out at 650 Districts and 5,735 Blocks throughout the country. This initiative is closed now as the set targets were successfully achieved.

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ANNEXURE-1

1.          The  Indian  Computer  Emergency  Response  Team  (CERT-In)  issues  alerts  and  advisories regarding latest  cyber  threats  and  countermeasures  on  regular  basis  to  ensure  safe  usage  of digital technologies.
2. All  authorised  entities/  banks  issuing  PPIs  in  the  country  have  been  advised  by  CERT-In through Reserve bank of India to carry out special audit by empanelled auditors of CERT-In on a priority basis and to take immediate steps thereafter to comply with the findings of the audit report and ensure implementation of security best practices.
3. Government has issued guidelines for Chief Information Security Officers (CISOs) regarding their key roles and responsibilities for securing applications / infrastructure and compliance.
4. Government has empanelled security auditing organizations to support and audit implementation of Information Security Best Practices.
5. All  organizations  providing  digital  services  have  been  mandated  to  report  cyber  security incidents to CERT-In expeditiously.
6. Government has formulated Crisis Management Plan for countering cyber attacks and cyber terrorism  for  implementation  by  all  Ministries/  Departments  of  Central  Government,  State Governments and their organizations and critical sectors.
7. Cyber security mock drills and exercises are being conducted regularly to enable assessment of cyber security posture and preparedness of organizations in Government and critical sectors such as Finance, Defence, Power, Telecom, Transport, Energy, Space, IT/ITeSetc participated.
8. CERT-In conducts regular training programmes for network / system administrators and Chief Information  Security  Officers  (CISOs)  of  Government  and  critical  sector  organisations regarding securing the IT infrastructure and mitigating cyber attacks.
9. Government  has  launched  the  Cyber  Swachhta  Kendra  (Botnet  Cleaning  and  Malware Analysis Centre). The centre is providing detection of malicious programs and free tools to remove the same.
10.   Government  has  initiated  setting  up  of  National  Cyber  Coordination  Centre  (NCCC)  to generate necessary situational awareness of existing and potential cyber security threats and enable  timely  information  sharing  for  proactive,  preventive  and  protective  actions  by individual entities. Phase-I of NCCC has been made operational.
11.    Under  the  Information  Security  Education  and  Awareness  (ISEA)  Project,  candidates  are trained in various formal/non-formal courses in Information Security.
12. Department of Payment and Settlement Systems (DPSS), Reserve Bank of India (RBI) has issued  circulars/  guidelines  related  to  security  and  risk  mitigation  measures  for  securing digital / online payment transactions.
13. RBI has advised the banks to provide online alerts for all card transactions {Card Present (CP) and Card Not Present (CNP)}, vide, RBI circular dated March 29, 2011.
14. RBI has also issued circulars dated September 22, 2011, February 28, 2013 and June 24, 2013 for  securing  electronic  (online  and  e-banking)  transactions  advising  banks  to  introduce additional security measures, as follows:
15.  All new debit and credit cards to be issued only for domestic usage unless international use is specifically  sought  by  the  customers.  Such  cards  enabling  international  usage  will  have  to essentially be EMV Chip and PIN enabled.
16.  Issuing banks should convert all existing MagStripe cards to EMV Chip card for all customers who have used their card internationally atleast once (for/ through e-commerce/ATM/POS).
17.  Banks should ensure that the terminals installed at the merchants for capturing card payments (including the double swipe terminals used) should be certified for PCI-DSS (Payment Card
18. Industry-Data Security Standards) and PA-DSS  (Payment Applications-Data Security Standards).
19.  Banks  should  ensure  that  all  acquiring  infrastructure  that  is  currently  operational  on  IP (Internet Protocol) based solutions are mandatorily made to go through PCI-DSS and PA-DSS certification. This should include acquirers, processors / aggregators and large merchants.
15. RBI has directed banks to mandatorily put in place an Additional Factor of Authentication (AFA)  for  all  CNP  transactions  w.e.f.  01.05.2013  failing  which  the  issuer  bank  shall reimburse the loss to customer without demur.
16. All authorised card payment networks are permitted to offer card tokenisation services to any token  requestor  (i.e.,  third  party  app  provider),  subject  to  certain  conditions.  All  extant instructions  of  RBI  on  safety  and  security  of  card  transactions,  Including  the  mandate  for Additional Factor of Authentication (AFA) / PIN entry shall be applicable for tokenised card transactions also (DPSS.CO.PD No.1463/02.14.003/2018-19) dated January 08, 2019).
17. The systems and procedures in banks must be designed to make customers feel safe about carrying out electronic banking transactions.
18. RBI has issued circular  on 'Security  and Risk Mitigation Measures  for Electronic Payment Transactions'  (DPSS.CO.PD  No.1462  /02.14.003  /2012-13)  dated  February  28,  2013.  Vide this  circular,  RBI  has  required  banks  to  introduce  following  additional  measures  to  secure electronic mode of payments like RTGS, NEFT and IMPS.
19. RBI  has  issued  'Master  Direction  on  Issuance  and  Operation  of  PPIs'  (MD  on  PPIs) (DPSS.CO.  PD.  No.1164/02.14.006/2017-18)  dated  October  11,  2017  (updated  as  on December 29, 2017).
20. RBI  has  issued  circular  no.  DBR.No.  Leg.BC.78/09.07.005/2017-18  dated  July  06,  2017 limiting the liability of customers on unauthorized electronic banking transactions.
21. RBI has issued circular no. DPSS.CO.PD.No.1417/02.14.006/2018-19 dated January 04, 2019 limiting  the  liability  of  customers  in  unauthorized  electronic  banking  transactions  in  PPIs issued by Authorised Non-banks.

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Annexure-II

The steps taken by the Government to promote digital payments in Ministries/Departments/States are as follows:

- a) Digital Payments Dashboard (digipay.gov.in) launched on 13th February, 2018 during the conference of State IT Ministers and State IT Secretaries.
- b) DigiVaarta  was  launched  in  Delhi  on  28th  September,  2018,  with  the  express intention  of  spreading  awareness  on  DigiDhan,  and  also  to  spread  popularity  of  BHIM's barcode-based merchant payment mode with merchants and traders at large. This launch has two components:
- A.  A  SMS application  which  operates  from  NIC's  SMS  Gateway  on  a  special  Short-code service allotted for this purpose by DoT with the number '14444'. Citizens will receive SMS messages  which  are  pre-approved  by  experts  and  the  response  messages  will  be  made available for further action, analysis and research. The Government proposes initially to pay

for  the  citizen's  response  so  as  to  promote  citizen's  engagement  and  make  the  awareness program completely free for the citizen.

- B.  A  Mobile  application  version  of  DigiVaarta,  which  can  be  accessed  and  used  by  smart phone  users.  This  app  can  perform  many  more  function  beyond  chat,  offers  audio-video tutorials etc.
- c) A campaign  was  undertaken  in  100  smart  cities  in  coordination  with  9  Ministries/ Departments for promotion of digital payments during the period from 1st July, 2018 to 31st October, 2018.  Smart Cities  are reporting total payment collection vs. digital collection from citizens on the Digidhan Dashboard.
- d) An  awareness  campaign  was  organized  in  the  SMART  Cities  of  North  East  to promote digital payments.
- e) Advisories are issued for the following: :
- i. To enable online payment systems with BHIM/UPI, BHIM QR code and Rupay Card.
- ii. To enable BHIM QR in their concerned physical payment receipt counters.
- iii. Utilities (Electricity/Water/Gas/Telecom/DTH)   to on-board on Bharat Bill Payment System (BBPS and printing of BHIM QR code   on all utility bills
- f) Government has waived off   Merchant Discount Rate (MDR) applicable on Debit Card/BHIM  UPI/Aadhaar-Pay  transactions  less  than  or  equal  to  Rs.  2000/-  in  value  for  a period of two years with effect from 1st January, 2018.
- g) Government of India has initiated incentive schemes such as BHIM cashback scheme for individuals, BHIM incentive scheme for merchants, BHIM Aadhaar merchant incentive scheme for promotion and wider adoption of digital payment.
- h) Government  is  co-ordinating  with  Ministries/Departments/States  to  enable  digital payment acceptance infrastructure:
11.  Utilities  (Electricity/Water/Gas/Telecom/DTH) have been requested for on-boarding on   Bharat Bill Payment System (BBPS) for easy accessibility to digital payments.
12.  All  Public  transport  operators  have  been  requested  to  enable  National  Common Mobility Card (NCMC) for digital payments.

## Following steps has been taken by the Govt. to promote payments through BHIM UPI.

- i) In order to promote and enable acceptance of UPI based payments at the small and micro merchants, Ministry of Electronics and Information Technology (MeitY) vide gazette notification No 6(19)/2017-DPD-1 dated 27th December 2017 has notified the reimbursement  of  MDR  charges  on  Debit  cards/BHIM-UPI  and  BHIM  Aadhaar  Pay transactions of value up-to Rs 2000 for two years effective from 1st Jan 2018.

## Promotion and Publicity in Digital Payment

- j) Meity is also working with IRCTC to promote digital payments into their website
- k) MeitY  is  working  with  leading  newspapers  in  India  to  promote  digital  payments across India.
- l) MeitY  ran  various  FM  campaigns  and  hoarding  campaigns  to  promote  digital payments.

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