Periodic Essay

Modernizing the payment system to increase financial inclusion in India

Abstract: Payments in India remain heavily cash reliant. This dependence creates economic inefficiencies and limits efforts to include the unbanked in the formal financial system. In response, the government has introduced a number of policies to promote non-cash payments, bolster the payments infrastructure, provide hundreds of millions of new payment-capable accounts to the unbanked, and encourage new technology and innovation by non-traditional firms. This Asia Focus reviews the role non-cash payments can play in India?s financial inclusion efforts, summarizes recent government policies to develop a national payment system that includes the unbanked, and assesses the challenges and implications of ongoing reforms.

Bibliographic Information

Provider: Federal Reserve Bank of San Francisco

Part of Series: Asia Focus

Publication Date: 2016

Issue: March

Order Number: 2