Lok Sabha Question No. 208 (STARRED), answered on 2021-12-13
Subject: Promotion of Digital Banking
Ministry: FINANCE
Asked by: Adala Prabhakara Reddy

## GOVERNMENT OF INDIA MINISTRY OF FINANCE

## DEPARTMENT OF FINANCIAL SERVICES

## LOK SABHA

## STARRED QUESTION NO. *208

ANSWERED ON MONDAY, DECEMBER 13, 2021 / AGRAHAYANA 22, 1943 (SAKA)

## PROMOTION OF DIGITAL BANKING

## *208. SHRI ADALA PRABHAKARA REDDY:

Will the Minister of FINANCE be pleased to state:

- (a) whether the Government is aware that most of the rural customers are not well versed with digital banking or the rules/procedures of using e-banking services and if so, the details thereof;
- (b) whether the Government is taking any steps to guide the rural population in availing digital banking services; and
- (c) if so, the details thereof and if not, the reasons therefor?

## ANSWER

## FINANCE MINISTER

(Smt. Nirmala Sitharaman)

- (a) to (c):  A Statement is laid on the Table of the House.

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## 8 th  POSITION

## STATEMENT REFERRED IN REPLY TO THE LOK SABHA STARRED QUESTION NO. *208 BY SHRI ADALA PRABHAKARA REDDY ANSWERED ON 13 th  DECEMBER, 2021 REGARDING 'PROMOTION OF DIGITAL BANKING'

- (a) A  pan-India  Financial  Literacy  and  Inclusion  survey  has  been  conducted  by  Reserve Bank of India (RBI), based on 3 parameters namely, financial knowledge, attitude and behaviour. As per the survey done by RBI on a total score of 21, the average urban & rural score for different zones is provided below:
- (b) & (c) Promotion of digital payment is one of the priorities of the Government to facilitate hassle  free  and  seamless  banking  transactions  for  the  people  of  the  country.  Several initiatives have been taken by Government of India through its various programs/agencies,  RBI  and  banks,  to  promote  and  create  awareness  about  digital payments in rural areas. The details of some of these initiatives are Annexed.

| Zone    |   Urban |   Rural |
|---------|---------|---------|
| North   |    11.5 |    11.5 |
| East    |    12.1 |    12.1 |
| Central |    12.5 |    12.1 |
| West    |    12.6 |    12.5 |
| South   |    11.2 |    10.3 |

As  a  result  of  the  initiative  taken,  there  has  been  a  paradigm  shift  in  digital transactions in India which is reflected in terms of the increase in the volume of  digital transactions over the last three financial years as illustrated below:

| Financial Year   | Volume (in lakhs)   |
|------------------|---------------------|
| 2018-19          | 2,32,602            |
| 2019-20          | 3,40,025            |
| 2020-21          | 4,37,445            |

Source: RBI

As observed from the above table, there has been a growth of 88% in digital payment volume  during  the  last  3  years  since  2018-19.  Further,  as  per  the  data  sourced  from National Payments Corporation of India (NPCI), India's own payment platform UPI has emerged as country's favourite digital payment choice, with over 22 billion transactions registered during FY 2020-21, showing 4 times growth over the last 3 years. Also, AePS inter-bank transactions during FY 2020-21 registered 9-fold growth, over the past 4 years.

Annexure as referred to in part (b) & (c) of the Lok Sabha Starred Question No. *208 for answer on 13.12.2021 regarding 'Promotion of Digital Banking'.

Initiatives taken to promote and create awareness digital payments are as under:

## A. Schemes of Government of India:

- i. The Digital Finance for Rural India: Creating Awareness and Access (DFIAA) 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.
- ii. Pradhan Mantri Gramin Digital Saksharta Abhiyan' (PMGDISHA) Scheme : The scheme is  implemented  as  a  Central  Sector  Scheme  by  Ministry  of  Electronics  &  Information Technology  (MeitY)  through  CSC  e-Governance  Services  India  Limited,  with  active collaboration  of  all  the  State  Governments  and  UT  Administrations.  The  scheme  was launched  in  February  2017  with  the  objective  to  impart  digital  literacy  in  rural  India  by covering 6 crore rural households (one person per household) at a total outlay of Rs. 2,351.38 crore  (approx.).  Under  the  Scheme,  to  ensure  equitable  geographical  reach,  each  of  the 2,50,000 Gram Panchayats across the country are envisaged to register an average of 200300 candidates. Special focus of the said Scheme is on training the beneficiaries on use of Electronic Payment System. Under the Scheme, as on 08th December 2021, a total of more than 5.39 crore candidates have been registered; 4.57 crore have been trained, out of which more than 3.39 crore candidates have been duly certified for implementing this scheme.

## B. Initiatives taken by RBI:

- i. RBI  conducts  Electronic  Banking  Awareness  and  Training  (e-BAAT)  programmes through its regional offices to create awareness about digital payments and target audience includes rural  area  population.  The  focus  of  this  training  includes  topics  on  safe  practices while  using  digital  payment  products,  Cyber  hygiene,  customer  protection,  grievance redressal mechanisms etc.
- ii. RBI has  been  also  carrying out multi-channel public awareness media campaigns under the  aegis  of 'RBI  Kehta  Hai' by  television,  radio,  online,  SMS  and  social  media  posts, whereby public is sensitised about how to be vigilant while using digital products such as mobile banking, ATMs, internet banking, etc., and how digital frauds could be averted.
- iii. RBI has carried out multi-lingual media campaigns on themes like 'Convenience of Digital Banking', 'Switch On / Off and Setting Transaction Limits' facility for card transactions, and

'Safety of Digital Banking' among others, through various advertisements issued in major newsprints.

- iv. Centre  for  Financial  Literacy  (CFL)  project: To  have  an  exclusive  focus  on  financial literacy at the block level through brick and mortar Centres, CFLs have been set up at the block level. The pilot project was initiated by RBI in 2017 in 80 blocks across nine  states across the country and was subsequently extended in 20 tribal/ economically backward blocks in these states in 2019. The outreach of the CFLs is now being scaled up across the country with  1058  CFLs  operationalized  in  30  states/UTs  serving  3174  blocks  as  on  01.12.2021. Awareness about digital banking is one of the areas covered under the CFL project.

## C. Initiatives taken by Banks:

- i. FLCs: Banks have been advised to conduct special camps through their FLCs (2 camps per month  on  'Going  Digital'  through  UPI  and  *99#  (USSD)  including  tailored  camps  for different  target  groups  viz.,  farmers,  Micro  and  Small  entrepreneurs,  school  children,  Self Help Groups and Senior citizens.
- ii. Rural  Branches  of  banks are  required  to  conduct  one  camp  per  month  covering  all  the messages that are part of Financial Awareness Messages (FAME) booklet and the two digital platforms UPI and *99# (USSD).
- D. Banking Correspondents (BCs) led initiative: A  strong  network  of  about  3.4  lakh  BCs, representing the last mile connect in the Banking Services delivery system  is also creating awareness while facilitating transactions in the rural areas, because of their familiarity with Local/Rural population.

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