Reserve Bank Governor Shaktikanta Das on Monday said the central bank is constantly working on policies, systems, and platforms to make the country’s financial sector strong, nimble and customer centric.
Addressing the RBI@90 Global Conference on ‘Digital Public Infrastructure and Emerging Technologies’, Das recalled various initiatives being taken by the RBI with regard to Unified Lending Interface (ULI) and Central Bank Digital Currency (CBDC).
The Governor also said that the UPI system has the potential to evolve into a cheaper and quicker alternative to the available channels of cross-border remittances and “a beginning can be made with small value personal remittances as it can be quickly implemented”.
According to the Economic Survey tabled in Parliament in July, remittances to India, the second largest source of external financing after service exports, ? are projected to grow at 3.7 per cent to USD 124 billion in 2024 and at 4 per cent to reach USD 129 billion in 2025.
Das said the Reserve Bank of India is looking forward to the journey towards RBI@100 with considerable optimism.
“We are constantly working on devising policies, approaches, systems and platforms that will make our financial sector stronger, nimble and customer centric,” he said.
Speaking on the theme of DPI and emerging technologies, he said over the last decade, the traditional banking system has undergone an unprecedented technological transformation.
By all indications, this process is likely to become even more intense in the coming years, he added.
He said DPI spurs market innovation by reducing transaction costs, democratising access, maintaining competition through interoperability, and attracting private capital.
Referring to the country’s experience, Das said “DPI has enabled India to achieve, in less than a decade, levels of financial inclusion that would have otherwise taken several decades or more”.
Digital Public Infrastructure refers to basic technology systems, created mainly in the public sector, which are openly available to users and other developers.
India’s DPI journey is a unique model, wherein the base technical infrastructure is built, operated and managed in the public sector, while the private sector accesses the DPI to create innovative customer facing services.
“The advantage of developing DPI in the public sector is that typically the private sector would be averse to capital investment to create infrastructure with uncertain returns,” the Governor said and added that privately created infrastructure may not also be amenable to democratised access or interoperability.
The Governor talked about India’s advancements in the field of digitalisation of the financial services.
He further said Unified Payments Interface (UPI), a real-time payment system, has emerged as a robust, cost-effective and portable retail payment system and is attracting active interest across the globe.
