The document discusses digital payments in India. It provides definitions of different types of digital payment instruments and outlines the history and evolution of digital payments in India from credit cards in 1981 to UPI in 2016. It describes key features of digital payments like convenience and security. Major reasons for increased adoption include demonetization in 2016 and expanding smartphone usage. Key digital payment methods discussed include cards, UPI, NEFT, RTGS, IMPS, internet banking, and mobile banking. The National Payments Corporation of India (NPCI) plays an important role in developing digital payment infrastructure.

1. PRESTIGE INDTITUTE OF MANAGEMENT AND RESEARCH
DIGITAL PAYMENT IN INDIA- A REVIEW
PRESENTED BY:
ARMAN ASATI
SHIVAM SAXENA
SAHIL BATAV
GUIDED BY:
DR.BHAVNA SHARMA

2. Digital Payment in India- a Review
Introduction
Digital Payment
◦ The world of digital or e-payments has terms which may be unfamiliar to a new reader.
This section provides a way of understanding different types of digital payments.
◦ Payments are made using payment instruments. Cash, for example, is a payment
instrument. So too are checks. However, when it comes to digital payments, it can be
confusing because of the range of different terms used for similar services, sometimes
even within the same country!
◦ In this section, we provide definitions based on the functionality of the main categories of
payment instrument, together with the common terms used. A key first step is
understanding which instruments are even available, and on what basis, in your country.
◦ In this section, we provide definitions based on the functionality of the main categories of
payment instrument, together with the common terms used. A key first step is
understanding which instruments are even available, and on what basis, in your country.

3. Journey of Digital Payment in India
• Credit Card Started on 1981
The credit card market in India started out in 1981 when Visa issued the card. Andhra Bank was the
pioneer of credit cards in India.
• ATM Card started on 1987
Hongkong and Shanghai Banking Corporation introduced the ATM concept in India in 1987. The
first ATM was set up in Andheri East, Mumbai.
• Internet Banking started on 1996
Internet banking arrived in India in the late 1990s. ICICI was the first bank to champion its usage
and introduced internet banking to its customers in 1996. With lower internet costs and increased
awareness about electronic media, online banking established itself only in 1999
• Mobile Banking started on 2002
In the year 2002 Mobile Banking was started in India by way of SMS Banking. Now it is becoming a
new generation platform in India. Mobile Banking is useful for the customers for making inquiries about
their balances on mobile phones.
• UPI started on 2016
It works by transferring money between two bank accounts along a mobile platform. The system is
said to be a safe and secure method of transferring money between two parties, and eliminates the
need to transact with physical cash or through a bank. The pilot system was launched in India on April
11, 2016.

5. Features of Digital Payment
• Easy and convenient
Digital payments are easy and convenient. You do not need to take loads of cash with you. All you need is your
mobile phone or Aadhaar number or a card to pay. UPI apps and E-Wallets made digital payments easier.
• Lower risk
Digital transactions are much more secure than traditional transactions because they are processed by secure
gateways which are hard to tamper with. There is a security in digital payment because it will be reflected in both
sender and receiver bank account statement and there is no physical cash is there so there is no chance of theft
of cash it is very secure.
• Virtual Terminal
A virtual terminal facilitates card not present transactions. It allows the merchant to make payments on behalf
of the customer. The customer isn’t required to present his card for the physical examination by the merchant.
• Fast and convenient
Digital payment is very fast it requires very less period of time to transfer money from one account to another and they are
very convenient because there is no physical existence of sender is required and we can do many works while sitting at home

6. The main reason of increase in Digital
Payments
Demonetization
In November 2016, the Government of
India announced the demonetization of
all ₹500 and ₹1,000 banknotes of old currency. It
also announced the issuance of
new ₹500 and ₹2,000 banknotes in exchange for the
demonetized banknotes.
The announcement of demonetization was followed
by prolonged cash shortages in the weeks that
followed, which created significant disruption
throughout the economy. People seeking to
exchange their banknotes had to stand in lengthy
queues, and several deaths were linked to the rush
to exchange cash.
The debit card point of sale transactions was twice
the size of value suggested by trend before the
demonetization. The UPI transaction was in a peak
after demonetization.

7. Expanding Use of Smartphones
Four years ago, mobile payments didn’t even exist in
India. But the smartphone wave has hit the whole
nation. The next few years will see about 70-80% of the
population owning smart phones. Not too long from now,
we would simply be able to tap our card or phone to a
device to purchase a product or a service.
Offers, Rewards, Cashbacks and Discounts
One thing that attracts all consumers is the promise of
getting something free with a product, or some kind of a
reward, cashback, or discount. These are some really
impactful factors that are responsible for consumers
preferring digital payments as opposed to other payment
methods. This shift will inevitably lead to the so-called
conventional methods of today, turning into
unconventional ones. When we make digital payments,
we get more spot discounts with immediate benefits.

8. (NPCI) National Payment corporation of India
National Payments Corporation of India (NPCI), an umbrella organisation for
operating retail payments and settlement systems in India, is an initiative of
Reserve Bank of India (RBI) and Indian Banks’ Association (IBA) under the
provisions of the Payment and Settlement Systems Act, 2007, for creating a
robust Payment & Settlement Infrastructure in India.
Considering the utility nature of the objects of NPCI, it has been incorporated as
a “Not for Profit” Company with an intention to provide infrastructure to the entire
Banking system in India for physical as well as electronic payment and
settlement systems. The Company is focused on bringing innovations in the retail
payment systems through the use of technology for achieving greater efficiency
in operations and widening the reach of payment systems.
NPCI, during its journey, has made a significant impact on the retail payment
systems in the country. Dedicated to the nation by our former President, Shri
Pranab Mukherjee, endorsed by the Hon’ble Prime Minister, Shri Narendra Modi
and later made the card of choice for the ambitious Pradhan Mantri Jan Dhan
Yojana, RuPay is now a known name.
RuPay is an Indigenously developed Payment System – designed to meet the
expectation and needs of the Indian consumer, banks and merchant eco-system.

9. Types of Digital Payment
Banking cards (Debit/Credit)
Banking cards offer consumers more security, convenience,
and control than any other payment method. The wide variety
of cards available – including credit, debit and prepaid – offers
enormous flexibility, as well. These cards provide 2 factor
authentications for secure payments e.g secure PIN and OTP.
RuPay, Visa, MasterCard are some of the example of card
payment systems. Payment cards give people the power to
purchase items in stores, on the Internet, through mail-order
catalogues and over the telephone. They save both customers
and merchants’ time and money, and thus enable them for
ease of transaction
Unstructured Supplementary service data
(USSD)
The innovative payment service *99# works on Unstructured
Supplementary Service Data (USSD) channel. This service
allows mobile banking transactions using basic feature mobile
phone, there is no need to have mobile internet data facility for
using USSD based mobile banking.

10. .
Unified Payment Interface
Unified Payments Interface (UPI) is a system that
powers multiple bank accounts into a single mobile
application (of any participating bank), merging several
banking features, seamless fund routing & merchant
payments into one hood. It also caters to the “Peer to
Peer” collect request which can be scheduled and paid
as per requirement and convenience. Each Bank
provides its own UPI App for Android, Windows and iOS
mobile platform(s).
Point of Sale
A point of sale (PoS) is the place where sales are
made. On a macro level, a PoS may be a mall, a
market or a city. On a micro level, retailers consider a
PoS to be the area where a customer completes a
transaction, such as a checkout counter. It is also
known as a point of purchase.

11. National Electronic Fund Transfer (NEFT)
National Electronic Funds Transfer (NEFT) is a nation-wide payment
system facilitating one-to-one funds transfer. Under this Scheme,
individuals, firms and corporates can electronically transfer funds
from any bank branch to any individual, firm or corporate having an
account with any other bank branch in the country participating in the
Scheme. Individuals, firms or corporates maintaining accounts with a
bank branch can transfer funds using NEFT.
Real Time Gross Settlement (RTGS)
RTGS is defined as the continuous (real-time) settlement of funds
transfers individually on an order by order basis (without netting).
'Real Time' means the processing of instructions at the time they are
received rather than at some later time; 'Gross Settlement' means
the settlement of funds transfer instructions occurs individually (on
an instruction by instruction basis)
Internet Banking
Internet banking, also known as online banking, e-banking or
virtual banking, is an electronic payment system that enables
customers of a bank or other financial institution to conduct a range
of financial transactions through the financial institution's website

12. Immediate Payment Service (IMPS)
IMPS offer an instant, 24X7, interbank electronic fund
transfer service through mobile phones. IMPS is an
emphatic tool to transfer money instantly within banks
across India through mobile, internet and ATM which
is not only safe but also economical both in financial
and non-financial perspectives
Mobile Banking
Mobile banking is a service provided by a bank or other
financial institution that allows its customers to conduct
different types of financial transactions remotely using a
mobile device such as a mobile phone or tablet. It uses
software, usually called an app, provided by the banks or
financial institution for the purpose. Each Bank provides its
own mobile banking App for Android, Windows and iOS
mobile platform(s).

13. Mobile Wallets
A mobile wallet is a way to carry cash in digital format. You can link your credit card or debit card
information in mobile device to mobile wallet application or you can transfer money online to mobile
wallet. Instead of using your physical plastic card to make purchases, you can pay with your
smartphone, tablet, or smart watch. An individual's account is required to be linked to the digital
wallet to load money in it. Most banks have their e-wallets and some private companies.
e.g. Paytm, Freecharge, Mobikwik, Oxigen, mRuppee, Airtel Money, Jio Money, SBI Buddy, itz
Cash, Citrus Pay, Vodafone, Axis Bank Lime, etc.
Now we will discuss about some famous mobile wallets and UPI Aps
Paytm
Paytm ("Pay-T-M", pronounced similar to ATM) is an Indian e-commerce, payment system and
financial technology company, based out of Noida, India.
Paytm is available in 11 Indian languages and offers online use-cases like mobile recharges, utility
bill payments, travel, movies, and events bookings as well as in-store payments at grocery stores,
fruits and vegetable shops, restaurants, parking, tolls, pharmacies and educational institutions with
the Paytm QR code.
As per the company, over 7 million merchants across India use this QR Code to accept payments
directly into their bank account. The company also uses advertisements and paid promotional
content to generate revenues.

14. PhonePe
PhonePe Private Limited, PhonePe is an Indian e-commerce payment system and digital wallet company
headquartered in Bangalore, India. It was founded in December 2015, by Sameer Nigam, Rahul Chari and Burzin
Engineer. PhonePe app went live in August 2016 and was the first payment app built on Unified Payments
Interface (UPI).
Google Pay
Google Pay (stylized as G Pay; formerly Pay with Google and Android Pay) is a digital wallet platform and online
payment system developed by Google to power in-app and tap-to-pay purchases on mobile devices, enabling
users to make payments with android phones, tablets or watches.
As of January 8, 2018, the old Android Pay and Google wallet have unified into a single pay system called Google
Pay. Android Pay was rebranded and renamed as Google Pay. It also took over the branding of Google.
The rebranded service provided a new API that allows merchants to add the payment service to websites, apps,
stripe, Braintree, and Google assistance. The service allows users to use the payment cards they have on file
with Google Pay.

15. Growth of Digital Payment in India
In 2019, I don't think that anybody is there who don't
know about the digital payment systems. As everybody
nowadays prefers to be cashless and there are various
new techniques that are become popular in 2019 like
google pay, phone pay, BHIM UPI, paytm and many
more. The debit cards and credit cards are always in
use and will stay for the long run. In 2022, one will be a
new digital India where the retail chains will also adapt
the digitalization easily. The demonetization teaches a
very great lesson that goes cashless. Our Prime
minister Narendra Modi has taken a very crucial step
and help in the growth of payment industry as well. This
will increase the number of digital payment channels in
the country of India.
This Graph shows us the growth of Digital Payment in India after
demonization

16. Barrier in Digital Payment
Illiteracy
ILLETRACY is the biggest problem in India. In rural are most of the people do not use digital payment they are using cash.
do not have proper knowledge about digital payment. Even literates do not use digital payment but the number is less than
illiterate.
Fear of losing money
The people who are not using digital payment are having fear of losing money. They don’t know that there is a proper
behind this and if they do digital payment properly so there is no chance of losing money.
Charges in card payment
At many places there are 1-2% charges on card payment mostly on credit card payment. These charges are taken by banks so
people do not want give extra charges.
Merchant do not accept digital payment
Digital Payment will be shown on bank account statement so it will be taxable for merchants that’s why they are not taking
payment.
Habit of using physical cash
People are habitual of using cash they are not using digital payment. They are using cash since ages so they find difficult to
change their habit. Mostly young generation are using digital payment and remaining are using cash.

17. THANK YOU