VOLUME: 09, Special Issue 04, (IC-SPIPS-2022), Paper id-IJIERM-IX-IV, May 2022 36 IMPACT AND SIGNIFICANCE OF DIGITAL PAYMENT IN INDIA
Dr. Jyoti Bathra
Assistant Professor SPIPS, Indore
Abstract - The digital economy is the collection of forces of economic process and production that interact with the digital society in the specific context of large and digital enterprises and drive digital business through various means. The combination of digital economy and digital society forms the basis for the creation of various digital enterprises and digital businesses. The digital market is a subset of the digital economy.
Digital banking is a new world view which offers significant advantages to banks in the form of extension of benefits and efficiency such as ease of payment and 24*7 access to banking administration to their customers. It is cultivated by using the state of the workmanship innovation foundation to achieve change in the internal cycles and external interfaces. In the traditional days when people waited in long queues at the bank with the belief that it was their turn to withdraw cash or deposit money in banks.
At present, individuals can approach the bank as per their advantage within their financial hours without standing in long queues. Previously, when digital payments exist, individuals are hesitant to change their exchange propensity even after demonetization, they have no decision to make their exchange with digital payments. The rapid growth of digital payments will be driven by the expansion of web usage, broader penetration, and government initiatives such as Digital India. A stable customer base should be built through providing customer delight. Nevertheless, the gist of the issue is that Indian banks, both private and public, need to offer quality support to meet better performance.
This research paper throws light on the use and importance of digital payment services in India.
Keywords: Digital Banking, Digital Market, Digital Payment, Customer Perception, Customer Satisfaction.
1 INTRODUCTION
As the country transitions to a credit-only environment following demonetization, the underlying frenzy and disarray have given rise to a whirlwind of concerns. Will a greater emphasis on online transactions provide convenience and considerable benefits, or will it merely increase pressure and costs? The Digital India program is a pioneering scheme of the Government of India with a vision to transform India into a digitally engaged society and information economy. One of Digital India's apparent functions is anonymous, paperless, and credit transactions only. To encourage the transition to a crediteconomy only, the government has imposed a slew of restrictions and giveaways on digital exchanges. Will they, along with other benefits, be sufficient to offset the increased risk of data fraud once it occurs?
1.1 Meaning of Digital Payment
A digital payment is a payment method that is made using digital means. Both the payer and the payee use digital modes to send and receive cash in digital payments. It is also known as electronic payment. There is no hard money involved in digital payments. All digital payment transactions are completed online. It is a convenient and time-saving method of making payments. If we are talking about money payments, it must first withdraw money from our account. Then use this money to make purchases in stores. A businessperson goes to the bank to deposit the money he received from you. This cycle is tiresome for both the buyer and the retailers. However, in digital payments, the money immediately moves from your account to the retailer's account. This cycle is pre- programmed, so neither buyer nor the retailer need to go to the bank.
1.2 Innovative Digital Payment Methods
NFC or MST Transmission Waves Stage Organizations coined to create exchange via NFC (Near Field Communication) and MST (Magnetic Secure Transmission) innovation. You can certainly make instalment to shippers through its remote communicating attractive waves
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without swiping your card through POS(Point of Sales) machines. You can benefit this office by downloading MST empowered application and furthermore, your telephone should uphold NFC office. Whenever it is done, subsequent to enlisting your card subtleties, you can make contactless exchanges through your telephone on any of dealers' POS terminal.
1.3 Digital Wallet Payment System
Money is loaded into wallets during this stage. With the introduction of e-wallets, you can also add money using computerised wallet applications. However, the requirement is that you can transfer assets to the same wallet. It implies that if you have PayTM or SBI's Buddy application on your phone, you can simply transfer money to another person's PayTM wallet or SBI's Buddy application who also has these applications installed. Similarly, you cannot transfer funds from your Pay TM wallet to your SBI Buddy wallet application. Other e-wallets available in the computerised marketplace include Mobiwik, Freecharge, Oxigen, Reliance Money, Paypal, Buddy, Lime, Payzapp, Pocket, Yes Pay, and others.
1.4 Ussd Code Payments System
If you don't have a cell phone or a web office, you can still make installment by dialing the USSD (Unstructured Supplementary Service Data) code from your basic telephone and following the specific instructions. It is a GSM-based innovation in which messages are exchanged. It is a stage that serves as a medium between media transmission and banking monetary administrations in general. Each banking application has a unique dialing code that you must confirm with your specialist organisation before transferring funds.
MMID is a seven-digit remarkable number provided by the bank when you enrol your mobile number. A person who wishes to send money and a person who wishes to receive money must both have MMID for the specific interbank reserves transfer. However, you can only move a limited amount through MMID in a single day. Almost all banks provide the option of making small payments.
1.5 UPI App Based Payments Platform
UPI has devised a remarkable feature that allows you to shift money without giving your account number or IFS code to the collector. UPI works on a continual basis, which means money is moved in real time. UPI also aids the other method of transferring funds. All financial applications, including HDFC UPI, SBI UPI, ICICI UPI, AXIS UPI, and a wide range of private and public banks, are compatible with UPI office. The great majority of banks have now integrated their UPI component into their mobile banking application.
1.6 QR Code Based Payments System
QR code is another alternative method of exchanging installment, in which you simply check the trader's QR code and complete the transaction. It is commonly used by all computerised installment programme such as BHIM and other banking applications to facilitate the exchange of installment. The dark square stores information about the items, and after filtering the code, the information is sent to the cell phone, and the installment are completed. When using QR code office, you do not need to physically enter anything.
The government has issued the Bharat QR code in order to drive the computerised instalment activities in the appropriate direction.
1.7 Use Digital Payment Methods
When compared to making trades such as money withdrawals, digital payment systems are more advantageous and secure. This kind of payment promotes transparency and accountability, lowers exchange costs, and reduces the size of the shadow or informal sector.
There will be no additional printing costs because the RBI had to burn through 7935 crores during the demonetization stage to print the recently scheduled money. Sets money and time aside- While real money is vulnerable to tax evasion, black money, and bogus money, digital money is vulnerable to data breaches and fraud over the internet. For example, India just experienced its largest data breach, putting 3.2 million credit cards at risk. Expenses associated with information interruptions are also increasing in India.
VOLUME: 09, Special Issue 04, (IC-SPIPS-2022), Paper id-IJIERM-IX-IV, May 2022 38 1.8 Objectives of the Study
1) To learn about people's attitudes toward digital payments in India.
2) To learn about the difficulties people have in making digital transfers.
3) To determine the most popular digital payment method.
4) To have an idea regarding the expected future of digital payments in India.
5) To examine turning cashless has benefited our residents.
6) To study about India will eventually become a credit economy only
7) To analyse the effects of the digital payment system in India, and to comprehend the repercussions of the digital system.
2 LITERATURE REVIEW
Sujith T S, Julie C D (2017) the article entitled “Opportunities and Challenges of E- Payment Systemin India”. The purpose of this investigation was to identify the issues and challenges of electronic payment systems and to provide some solutions to improve the e- payment system. E-payment systems also provide more opportunities. The investigation discovered that the digital revolution has made digital payments simple. The investigation also discovered that the reach of mobile networks, the Internet, and electricity is expanding digital payments to remote areas. The number of digital payments will almost certainly increase as a result of this.
Mamta, Prof. Hariom Tyagi and Dr. Abhishek Shukla (2016) the article entitled
“The purpose of this investigation was to identify the issues and challenges of electronic payment systems and to provide some solutions to improve the quality of e-payment systems. The successful implementation of electronic payment systems is dependent on how the security and protection dimensions perceived by consumers, as well as sellers, are managed, which would increase market confidence in the system.
Preeti Garg and Manvi Panchal (2016) the article entitled “Study on Introduction of Cashless Economy in India 2016: Benefits and Challenge’s”. This paper considered individuals' perspectives on the presentation of a cashless economy in India. The investigation was conducted in the Delhi area, and data was gathered using an organised poll and analysed using the basic rate technique. Respondents' reactions show that a cashless economy will aid in the detection of dark cash, counterfeit money, the fight against illegal intimidation, the reduction of money-related burglary, and the improvement of our nation's financial development. Significant challenges to strategy implementation include digital extortion, a high rate of ignorance, individual disposition, and a lack of transparency and effectiveness in digital payment systems. According to the findings, the presentation of a cashless economy in India is on the right track. It aids in the development and advancement of the Indian economy.
Vidya Shree DV, Yamuna N. and Nitua Shree G (2015) the article entitled “A Study on new Dynamics in Digital Payment System - with special reference to Paytm and Pay U Money”. The research paper focuses on the impact of new digital payment systems on clients and any issues that may arise. According to the findings of the study, people are more aware of online payments through mobile applications, and there is a greater expansion in the rate of development. The study also discovered that Paytm and Pay U cash offer simpler payment structures than the digital payment system.
3 RESEARCH METHODOLOGY
Secondary data from various research papers, reports, and government data has been studied and analysed in order to study the impact of digitalization.
4 RESULTS AND DISCUSSION
The Indian economy is growing quickly, and people's proficiency levels are increasing as well, but this is determined by the number of people enrolled in schools and universities.
However, the number of people who know how to work a computer, a mobile device, or any other type of working framework cannot be determined by education rate. Nowadays, even the working class has high-quality Android phones, but they lack comprehensive knowledge on how to use them effectively. Regardless of whether a portion of people know how to use it, they are wary of doing so because of online fraud, cyber crime, limited proficiency,
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ignorance of online guidelines, and so on. Furthermore, people living in rural areas prefer to visit banks to conduct transactions rather than doing so online because they believe that the presumed worth of a worker is more important to them. If they find themselves in a difficult situation, they know who to contact; however, doing business online does not bind them to a specific individual. The government stepped up its efforts to connect the Aadhar numbers of the clients in order to find the guilty parties. However, many people reduced their ledgers in order to avoid paying any kind of tax to the government. Individuals discover new techniques or approaches to save themselves with each new application of a rule. First and foremost, it is critical to change people's perceptions that whatever is being done is primarily for their own benefit. It may appear difficult and absurd to do today, but it will be beneficial in the long run. It is a combination of individual insights and a lack of financial proficiency among the people. Banks' functions are extremely important in spreading these data, and representatives must stay up to date.
Another significant barrier to transforming the paper economy into a computerised economy is a lack of or inability to access the internet. When it comes to web availability, there are still a number of government banks that do not have a web network. These problems are significantly more prevalent at higher elevations. As a result, without web offices, it is extremely difficult to achieve the goal of computerising the economy. ATMs frequently have cash but are unable to distribute it because they cannot read the card without legitimate web access. Clients have a sense of security visiting banks and carrying out their errands because of these common issues. Aside from these issues, it has been observed that individuals believe that by utilising net banking, ATMs, or other e-banking offices, they will be subjected to an unnecessary burden of paying various charges. They will try not to use these offices in the future. Furthermore, when it comes to the execution of these offices in the provincial regions, various issues such as a lack of foundation offices, a dense landscape, and a lack of electric power are common in country India.
5 FINDINGS OF THE STUDY
1. The government's and RBI's payment framework activities have resulted in increased recognition and deeper penetration of non-cash payment modes.
2. Continuously improving innovation and media transmission offices have given a boost to the elective electronic instalment framework.
3. Checks have outlived their usefulness and will continue to exist in the medium term.
4. Government actions, such as the introduction of GST and demonetization, are likely to broaden the expense net and expand the conventional economy.
6 SUGGESTIONS
The following measures are suggested for the smooth use of the money-less framework in India.
1) The government needs to get a simple and productive e-payment framework, techniques used by the government and RBI to support credit-only transactions by authorising installment banks and advancing portable wallets.
2) As part of the government's "Make in India" initiative, RuPay cards and Aadhar-based payment frameworks should be prioritised. The government should impose an assistance charge on credit cards and advance payments.
3) Measures to limit money usage by imposing fees on cash withdrawals that exceed a certain threshold.
4) The government should periodically direct a monetary education mission to make the populace aware of the benefits of electronic payments.
5) In order to improve monetary incorporation, business journalists, e-SevaKendras, and so on may be permitted to make miniature receipts and payment exchanges utilising Aadhar confirmation.
6) Ladies should be instructed through missions to speed up the receipt of computerised installment. Lady strength will be prompted by financial proficiency. This will cause advanced and social upheaval.
7) Important financial skills may also be imparted in schools.
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8) Encourages all segments to adopt non-monetary electronic payment methods in place of cash. Plans like the Lucky Grahak Yojana and the digidhanVyapar Yojana must continue to empower electronic payment methods.
9) Also, many other tax‐ saving investment classes like tax‐ saver fixed deposits, life insurance policies, PPF, NSC, house rent allowance, education loan interest, home loan, etc.
7 CONCLUSION
Above all, the issue of proficiency should be handled by the public authority, and for that, we must solidify our educational situation from the start. Bank employees must take on significant responsibilities for senior citizens. There is a need to establish data centre from which any question about programmes, strategies, new applications, or innovative data can be taken. Furthermore, informed young people should play a role by assisting others and sharing their knowledge with those who are unable to complete their task alone. Another issue of cyber crime and network security should be addressed by enacting and enforcing stricter digital security guidelines.
Education and training in wording now, as well as the most recent innovation for its advancement in urban and rural areas, can help the economy become digitalized with its use in everyday life. Banking sector could also begin in this preparation strategy by providing information and assisting individuals with less awareness or no information corresponding to its utilisation can prompt an extreme change by acceptance of digital payment framework by individuals with its full information in their regular daily existence like withdrawal of money, store of money, and check.
Computerized instalment helps India in all areas by providing financial security and well-being, as well as propelling the way of life by appropriating the most recent advancements for globalisation and modernization of our nation, which prompts the turn of events. As a result, Indian culture should also assist the government in obtaining these frameworks and strategies for our country's advancement and development. Indeed, gradual and step-by-step change is taking place, but the length of time it will take is unknown at this time, given that the country's innovation and advanced instalment market has only recently begun.
REFERENCES
1. Dr. Ravi CS “Digital payments system and rural India: A review of transaction to cashless economy”, International Journal of Commerce and Management Research, May, 2017.
2. https://paytm.com and https://www.payumoney.com
3. Mamta, Prof. Hariom Tyagi and Dr. Abhishek Shukla “The Study of Electronic Payment Systems”.
International Journal of Advanced Research in Computer Science and Software Engineering, 2016.
4. Preeti Garg and Manvi Panchal the article entitled “Study on Introduction of Cashless Economy in India 2016:
Benefits & Challenge‟s”. IOSR Journal of Business and Management (IOSR-JBM), 2016.
5. MD. Shakir Ali, MD Wasim Akhtar and S. K. Safiuddin “Digital Payments for Rural India - Challenges and Opportunities”, International Journal of Management and Applied Science, June, 2017.
6. Sujith T S, Julie C D “Opportunities and Challenges of E-Payment System in India”, International Journal of Scientific Research and Management (IJSRM), 2017.
7. The Indian Banker Journal.Vidya Shree DV, Yamuna N. and Nitua Shree G “A Study on new Dynamics in Digital Payment System - with special reference to Paytm and Pay U Money”, International Journal of Applied Research 2015; 1(10): 1002-1005.
