Package by government for Digital and Cashless Economy

The government of India is trying hard to make India cashless and after demonetization, there has been a surge in digital transactions through use of credit/debit cards and mobile phone applications/e-wallets, etc.

A lot of new features are being provided by various companies for people to go cashless like PayTM, Ultracash, PayUMoney, AirTel Money, Lime, Citrus Pay, Freecharge, ICICI Pockets, Itzcash, Jio Money, Mobikwik, PayUMoney, mRupee, Oxigen Wallet, SBI Buddy, Vodafone M-Pesa, Zeta Wallet, Vpay Qwik, and daily new schemes have been announced to woo customers.

Recently the Central Government has decided on a package of incentives and measures for the promotion of digital and cashless economy in the country.

The recent announcement made are:

1. The Petrol pumps will offer a rate of 0.75% of the sale price to consumers on purchase of petrol/diesel if payment is made through digital means.

2. There will be the deployment of 2 POS devices each in 1 Lakh villages with a population of less than 10,000. and POS machines will be deployed at primary cooperative societies/milk societies/agricultural input dealers to facilitate agri-related transactions through digital means.

3. Rural Regional Banks and Cooperative Banks will issue “Rupay Kisan Cards” to 4.32 crore Kisan Credit Card holders to enable them to make digital transactions at POS machines/Micro ATMs/ATMs.

4. Railways will provide incentive by way of discount up to 0.5% to customers for monthly or seasonal tickets from January 1, 2017, if payment is made through digital means.

5. All railway passengers buying online tickets shall be given free accidental insurance cover of up to Rs. 10 lakh.

6. A discount of 5% will be given to catering, accommodation, retiring rooms, etc. being offered by railways if payment of these services through digital means.

7. Public sector insurance companies will provide incentives, by way of discount or credit, up to 10% of the premium in general insurance policies and 8% in new life policies of Life Insurance Corporation if the payment is made by digital means.

8. The transaction fee/MDR charges related to digital payment will be born by Central Government Departments and Central Public Sector Undertakings or State Governments, a consumer should not be asked to bear it.

9. Monthly rental for PoS terminals/Micro ATMs/mobile POS for the merchants of Public sector banks will be not more than Rs. 100 per month. With lower rentals, more merchants will install such machines and promote digital transactions.

10. No service tax will be charged on digital transaction charges/MDR for transactions up to Rs.2000 per transaction.

11. For the payment of toll at Toll Plazas on National Highways using RFID card/Fast Tags, a discount of 10% will be available to users in the year 2016-17.

12. The government waives service tax charged while making payments through credit card, debit card, charge card, or any other payment card; waiver limited to payments up to Rs. 2,000 in a single transaction.

This step of government will surely change the Indian economy and we are on the road to becomes a cashless country.