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Tier 2, 3 cities see sluggish growth in digital payments
Digital payment has been one of the key features of the government’s ‘Digital India’ initiative and online payment platforms and services have indeed spread themselves in the country.
According to Credit Suisse report, India’s mobile payments market is likely to touch $1 trillion by 2022.
Post the demonetisation, whereby Prime Minister Narendra Modi on November 8, 2016 declared that Rs 500 and Rs 1,000 denomination notes would become invalid, digital transactions shot up tremendously. The Unified Payment Interface (UPI) also has been accepted well. Despite the rise in the number of platforms that enable businesses to offer online payment experience to their customers regardless of location, instrument or mode, still there is a long way ahead as the penetration has mostly been in tier I cities.
RBI expects the country will have five million active point of sale (PoS) machines by the end of 2021. However, to achieve it, there are several hurdles to be crossed.