The digital payments in the country should remain as a public good. Do you agree with this view? Justify (200 Words)
Refer - Business Line
Enrich the answer from other sources, if the question demands.
IAS Parliament 5 years
KEY POINTS
· The government and the RBI bear the cost for issuance of currency, which is a public good.
· Digital payments that substitute paper-based transactions are also public good for which both the RBI and NPCI have developed the infrastructure without any profit intent.
· Like NPCI, the New Umbrella Entities would primarily serve banks, which in turn would facilitate their customers to transact digitally in a seamless fashion.
· Bringing in the concept of profit for such umbrella entities providing essential payment services is likely to stifle decisions made towards public good.
Reasons
· It is good to have NUEs for digital payments to promote competition and spur innovation.
· However, there are risks involved in privatisation and in consumer financial transactions data being exposed to exploitation.
· Like RTGS is with the RBI or UPI with NPCI, other retail digital payments services should remain under an umbrella not run by private entities for profit.
· NPCI as a ‘not-for-profit’ umbrella entity is already a role model.
· Even if NUEs are licensed, it should be ensured that a single entity does not promote two NUEs.
