India is taking transformative steps towards progress with pathbreaking initiatives such as demonetisation, GST and Digital India. Digital transactions have been surging since demonetisation, with net banking, credit cards, digital wallets, payment gateways, Aadhaar pay, PPI, UPI, payments bank and BHIM since demonetisation. The currency fluctuation highlighted India’s biggest challenge—the demarcation of the banked and the unbanked. In his Independence Day speech last year, PM Narendra Modi said, “India is known in the world for its prowess in IT and digital revolutions. We should lead from the front to make a move towards digital transactions. We should move towards a less-cash economy. Now, an era of digital currency has started and India should not lag behind.”
Industry is striving to make India’s vision of full financial inclusion an attainable goal. Technology is at the forefront for this agenda, and private players have floated several options, but they have limitations and security concerns. Hence, it is imperative to introduce digital fiat currency for monetary sovereignty and policy effectiveness.
