Lok Sabha Question No. 1217 (UNSTARRED), answered on 2025-07-28
Subject: Digital Transaction in promoting Cashless Economy
Ministry: FINANCE
Asked by: Dr. Shrikant Eknath Shinde, Shri Ravindra Dattaram Waikar, Smt. Shambhavi, Shri Naresh Ganpat Mhaske

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF FINANCIAL SERVICES

## LOK SABHA UNSTARRED QUESTION NO. 1217

ANSWERED ON MONDAY, JULY 28, 2025/ SRAVANA 6, 1947 (SAKA)

## DIGITAL TRANSACTION IN PROMOTING CASHLESS ECONOMY

## 1217.  SMT. SHAMBHAVI:

DR. SHRIKANT EKNATH SHINDE:

SHRI RAVINDRA DATTARAM WAIKAR:

SHRI NARESH GANPAT MHASKE:

Will the Minister of FINANCE be pleased to state:

- (a) the contribution of the digital transactions in promoting a cashless economy and enhancing transparency in financial systems during the last six years, year-wise;
- (b) the details of the adoption rates of the digital payments in tier-2 and tier-3 cities as part of the country's digital transformation in transactions during the above period, State-wise and year-wise:
- (c) the  mechanisms  in  place  to  track  and  monitor  the  Government  performance  of  digital payment platforms to ensure seamless user experiences;
- (d) the steps taken by the Government to support small businesses and MSMEs in adopting digital payment systems to expand their customer base and improve efficiency, and
- (e) whether  the  Government  has  any  data  on  the  contribution  of  digital  transactions  in enhancing tax compliance and reducing the informal economy, if so, the details thereof?

## Answer

## MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI PANKAJ CHAUDHARY)

(a) and (b): The details of digital payment transactions during the last six financial years, i.e. FY 2019-20 to FY 2024-25 is attached as Annexure-I. The Government has been closely working with different stakeholders including the Reserve Bank of India (RBI), National Payments Corporation of India (NPCI), fintechs, banks and State Governments to increase the adoption rates of digital payments  in  the  country  including  in  tier-2  and  tier-3  cities.    RBI  has  setup  a  Payments Infrastructure Development Fund (PIDF) in 2021 to encourage deployment of digital payments acceptance infrastructure in tier-3 to 6 cities, North-Eastern States and Jammu & Kashmir. As on May 31, 2025, around 4.77 Crore digital touch points have been deployed through PIDF. (c)  The  RBI  has  developed  the Digital  Payments  Index  (RBI-DPI) to  measure  the  extent  of digitisation of payments across the country. The index is published semi-annually and is based on March 2018 as the base period (Index = 100). As per the latest release, the RBI-DPI stood at 465.33 for September 2024, reflecting continued growth in digital payment adoption, infrastructure, and performance across the country (d) In order to support small businesses and MSMEs in adopting digital payment systems to expand their  customer  base  and  improve  efficiency,  various  initiatives  have  been  taken  by  the Government, RBI and NPCI from time to time. These, inter alia, includes incentive scheme for promotion  of  low  value  BHIM-UPI  transactions  for  small  merchants,  Trade  Receivables Discounting System (TReDS) guidelines that allows for MSMEs to get their invoices discounted on the TReDS platform at competitive rates and rationalization of Merchant Discount Rate (MDR) for Debit Card Transactions. (e)  The  growing  adoption  of  digital  payments  has  revolutionized  access  to  financial  services, particularly  for  underserved  and  unserved  communities.  By  enabling  seamless,  traceable transactions through platforms like UPI, digital payments have created a robust financial footprint for  individuals  and  businesses.  These  footprints  serve  as  alternative  data  points  for  financial institutions,  allowing  them  to  assess  creditworthiness  even  in  the  absence  of  traditional documentation. As a result, more people are able to access formal credit channels, which not only empowers economic participation but also brings more entities into the formal financial ecosystem. Digital platforms like UPI have enabled citizens including small vendors and rural users to accept

digital payments, reducing cash dependency and increasing formal economic participation.

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Details of digital transactions since last six financial year

| Financial Year   | Volume (in Crore)   | Value (in lakh Crore)   |
|------------------|---------------------|-------------------------|
| FY 2019-20       | 3,401.55            | 1,619.69                |
| FY 2020-21       | 4,370.68            | 1,414.58                |
| FY 2021-22       | 7,197.68            | 1,744.01                |
| FY 2022-23       | 11,393.82           | 2,086.85                |
| FY 2023-24       | 16,443.02           | 2,428.24                |
| FY 2024-25       | 22,198.15           | 2,862.12                |

## Annexure I