Boosting Electronic Transactions in India. Contribute now

          Government of India has placed draft proposals for facilitating electronic transactions in India in public domain.

          The draft has a caveat: (The Proposals placed below are only at the draft stage and are being placed here to obtain public opinion. The proposals as they stand at this stage, do not imply any commitment from the government)

          Comments/suggestions are invited on the draft text which can be accessed through http://mygov.nic.in(External Website that opens in a new window) Portal. The last date to share your views is 29 June, 2015 by 5:00 p.m.

          The comments/suggestions have been flowing non-stop in the last couple of days. It may be observed that fellow Indians are providing their comments even during the night time. This indicates the high level of interest amongst Indians for Safe eTransactions.

          Goal of this Policy: - Provide necessary incentives from government for migration from Cash/Cheque transactions to eTransactions.

 Way Forward: - Inputs have been sought from wide-ranging experts/stake-holders i.e which includes RBI,NPCI, NIBM, public and private sector banks, card service providers, mobile service providers, research institutions, organizations working in this area and various government departments.

A beginning has been made and in the coming months the detailed guidelines will be rolled out.

Be part of the thought process by providing your comments/suggestions.  

A large number of comments/suggestions will enable the decision makers to make the best choices. 

Incentivise credit or debit card transactions in India – Simple not complicated process required

Taking a leaf from other countries strategies to boost CashLess transactions, Shri Jaitley said the following while presenting the Indian Union Budget 2015.

“One way to curb the flow of black money is to discourage transactions in cash. Now that a majority of Indians has or can have, a RuPay debit card, I, therefore, propose to introduce soon several measures that will incentivise credit or debit card transactions, and disincentivise cash transactions.”

Briefly the following are a few examples on nation's journey in the CashLess path.

Thailand: During the last quarter of 2012, the apex bank of Thailand observerd that the number of transactions through debit cards was on the increase. On a detialed analysis, it was observed that the majority of the transactions were for cash withdrawal and not for goods and service purchases.

To shift the transactions from cash mode to goods/services purchases , Bank of Thailand embarked on a major publicity drive. This strategy has paid off and slowly but steadily the share of good/services purchases via Debit/Prepaid Cards is on the increase.

Korea: Korea adopted a different strategy to boost goods/services purchases through eTransaction modes especially credit/debit/prepaid cards. The strategy has been so successful that it is referred to most nations who want to reap the benefits of CashLess transactions.

To reduce the chances of credit card traps i.e over purchasing/impulsive buys, Korean government reduced tax deductions on credit card transactions and increased tax deductions for debit and prepaid cards.

CashLess in Korea account for 70% of the value of all consumer payments. Korea's journey to the CashLess society begun 20 years ago.

United States of America: In USA, the Internal Revenue Service (IRS) has specific tax rules to encourage payment of taxes electronically, especially credit cards.

These rules are applicable to both individuals and businesses. For example, one can deduct credit and debit card fees incurred if you paid your individual federal income taxes electronically. Another deduction is available if a credit card company imposes fees on a business for the service of processing charged sales. If there is business credit card, there are qualifications for deductions based on annual fees and late fees charged by your provider.

The deductions were necessary as the credit/debit card issuance institutions or aggregators charge for the services provided. The Internal Revenue Service, or IRS, offers electronic payment systems for tax purposes, but other federal laws prohibit the IRS from directly paying any of the fees associated with debit or credit transactions. The IRS created a deduction in 2009 to offset the fee assessed by your credit card company when you make electronic tax payments. T