India’s payments ecosystem has evolved through a calibrated yet adaptive process, guided by successive Payments Vision documents issued by the Reserve Bank of India (RBI) since 2001. Payments Vision 2028 Payments Vision 2028 builds upon the remarkable trajectory of digital payments in India with the core theme – ‘Shaping India’s Payment Frontier’. It underscores the dual imperative of consolidating and strengthening the existing systems / infrastructure, while pioneering the future of payments. Under the core theme, certain specific initiatives as outlined below have been identified focusing on operational excellence, strategic innovation, and ensuring that the payment infrastructure remains resilient, inclusive, user-friendly, and technologically advanced. To promote inclusivity and resilience, a framework for interoperability in TReDS is also proposed to be developed to promote an integrated, efficient, and accessible receivables discounting ecosystem. To enhance safety in digital payments, enabling or disabling transactions across digital payment modes via issuer channels shall be explored. A shared responsibility framework with both the customer’s bank (issuer) and the beneficiary’s bank jointly bearing the liability shall be pursued. A review of the design and security features of cheques shall be conducted. Introduction of a Cyber Key Risk Indicators (KRI) framework for non-bank Payment System Operators shall be implemented for enhancing cyber resilience. Regarding cross-border payments, a review of the cross-border payments framework shall be conducted to enhance efficiency, and which shall be complemented by publishing dedicated reports on specific aspects. For promoting ease of doing business and convenience, the regulatory process for cross-border payment authorisation under the PSS Act, 2007 and FEMA, 1999 shall be streamlined along with examining the case for recognising Small Payment System Providers under a perpetual regulatory sandbox structure. Providing flexibility to customers to switch among payment service providers seamlessly through implementation of a Payments Switching Service (PaSS) shall be examined. To provide a fillip to research pertaining to digital payments, dedicated research and training capacity shall be focused upon apart from providing enhanced access to domestic and cross-border payments data. To promote systemic stability and integrity, entities deemed to be playing a critical role in facilitating digital payments shall be brought within the regulatory fold. Introduction of a uniform Domestic Legal Entity Identifier (DLEI) shall be explored. g. Innovation in card payments space shall be encouraged. Introduction of electronic cheques shall be explored. To read the complete document, click here. Globalisation and Trust Phase (Payments Vision 2025) The Payments Vision 2025, launched in 2022, reflected a confident, globally integrated digital payments ecosystem. Anchored on the theme “E-Payments for Everyone, Everywhere, Every time (4Es)”, it rested on five goalposts - Integrity, Inclusion, Innovation, Institutionalisation, and Internationalisation. The alternative authentication framework, Master Direction on Payment Aggregators, near real-time Cheque Truncation System, etc., were the key outcomes. To read the full report, click here. Measurable Outcome Phase (Payments Vision 2019-2021) The Payments Vision 2019-2021 introduced a results-oriented framework under the theme “Empowering Exceptional (E)-payment Experience”. It articulated five core attributes - safety, security, convenience, speed, and affordability and established quantitative targets, including a fourfold increase in digital transactions by 2021. Vision Statement Empower every Indian with access to a bouquet of e-payment options that is safe, secure, convenient, quick and affordable. The Vision 2021 for payment and settlement systems in India enhances the strong foundation built over the last two decades. While the pursuit towards a ‘less cash’ society continues, accompanied by the ambition to have a less-card India as well, the endeavour is to also ensure increased efficiency, uninterrupted availability of safe, secure, accessible and affordable payment systems as also to serve segments of the population which are hitherto untouched by the payment systems. The decade to follow will witness a revolutionary shift in the way Indian citizens use digital payment options and will also empower them with an e-payment experience that will be exceptionally safe, secure and truly world class,. Vision 2021 concentrates on a two-pronged approach of, (a) exceptional customer experience; and (b) enabling an eco-system which will result in this customer experience. With this in view, the Vision aims towards, enhancing the experience of empowering payment enabling the Eco-system and Infrastructure putting in place a Forward-looking Regulation supported by a Risk-focussed Supervision. To achieve the above, the Vision envisages four goal-posts (4 Cs) – Competition, Cost, Convenience and Confidence. For enhancement of Competition in the payment systems landscape, specific thrust areas like creating regulatory sandbox, authorising new players, etc., have been incorporated; this along with the presence of multiple players in the market is expected to achieve optimal Cost for the customers; freer access with availability of multiple payment system options anytime-anywhere should cater to the requirement of Confidence. It is recognised that cash entails a significant cost to the whole economic system, including consumers. Migration to digital modes of making a payment can obviate some of these costs and can give customers a friction-free and enjoyable experience. Giving them multiple options is expected to make this experience exceptional, apart from furthering growth measurable in terms of digital payments turnover to GDP. The savings achieved at all levels on account of digitisation of payments need to be considered in pricing of these services to the end customers. Payment System Operators (PSOs) need to consider cost of accessing and managing transactions and accordingly price their services. The aim is towards progressive reduction in ‘per-transaction' cost to customers keeping in view the marginal cost advantage with increase in the number of transactions. The need to move towards marginal cost of pricing based on volume of transactions handled needs no over-emphasis. Expected Outcomes With concerted efforts and involvement of all stake holders, the four goal-posts of Vision 2021 with 36 specific action points over the 36-month timeframe will have the following 12 specific outcomes: Further decrease in the share of paper-based clearing as a percentage of retail payments, particularly in terms of number of paper instruments processed. Given the current trend in cheque usage and the thrust to shift to digitised transactions it is expected that the volume of cheque-based payments would be less than 2.0% of the retail electronic transactions by 2021. Accelerated growth in individual retail electronic payment systems, both in terms of number of transactions and increased availability. Payment systems like UPI / IMPS are likely to register average annualised growth of over 100% and NEFT at 40% over the vision period. The number of digital transactions is expected to increase more than four times from 2069 crore in December 2018 to 8707 crore in December 2021. Measurably, the digital payment transaction turnover vis-à-vis GDP (at market prices-current price) is expected to further increase to 10.37 in 2019, 12.29 in 2020 and 14.80 in 2021. Payment transaction turnover, including CCIL transactions and paper, is expected to be 22.30 times the GDP (at market prices-current price) by December 2021. Increase in use of digital modes of payment for purchase of goods and services through increase in debit card transactions at PoS (35% increase during the vision period) and continued growth in PPI transactions. Usage of debit cards at PoS transactions is expected to be at least 44% of total debit card transactions (at PoS + ATM). In value terms it is 15.2 per cent in 2018-19 (5.2 per cent in 2014-15) which is expected to be 22% by end 2021. Increased deployment of card acceptance infrastructure across the country including at smaller centres with a substantial portion of the infrastructure taking care of processing contactless card payments. Given the current growth trend it is expected to have 5 mn active PoS by end 2021; digital PoS (QR code) is also expected to increase substantially; and the total card acceptance infrastructure will be upscaled to six times present levels by end 2021. This is expected to support aim of cash-lite economy and also shift Cash on Delivery (CoD) transactions to digital modes for e-commerce. While no specific target is considered for cash in circulation, the enhanced availability of PoS infrastructure is expected to reduced demand for cash and thus over time achieve reduction in Cash in Circulation (CIC) as a percentage of GDP. Further facilitation of mobile based payment transactions as gauged on basis of the registered customer base (expected increase of 50% considering the base effect). Enhanced usage of electronic payment systems is expected to reduce the marginal cost given the additional volume. The pricing of such services to customers should, over the vision period, show reduction of at least a 100 bps from current levels. Plus a shift from ad valorem rates to per transaction rates is envisaged, as usage of a system is irrespective of the value of a transaction. Security of systems and customer centricity as reflected by – Decrease in Technical Declines reported across various payment systems by 10% year-on-year. Reduction in Business Declines reported across various payment systems by 5% year-on-year. This will be achieved through targeted hand-holding of merchants and customers with customised campaigns by partnering with system operators and system participants. Improvement in Turn Around Time (TAT) for resolution of customer complaints by PSOs. FTS [Fraud to Sales (Fraud value / Sales value) x 10000] count for payment systems is expected to be less than 10 bps for most of the payment systems. Enhanced healthy competition in the payments space and establishment of new PSOs during the Vision period is envisaged. To read the complete document, click here. Digital Transformation Phase (Payments Vision 2016-2018) Payments Vision 2018 (covering 2016-2018) coincided with India’s digital payments takeoff. Its focus was to encourage electronic payments across all sections of society while maintaining safety and resilience. The period witnessed the launch of transformative platforms such as Unified Payments Interface (UPI), under NPCI’s stewardship. To read the complete document, click here. Inclusion and Standardisation Phase (Payments Vision 2012-2015) The Payments Vision 2012-2015 introduced the explicit goal of achieving a less-cash society, emphasising interoperability, inclusion, and consumer protection. Notable outcomes included the licensing and expansion of Prepaid Payment Instruments (PPIs), groundwork for the Trade Receivables Discounting System (TReDS), Bharat Bill Payment System (BBPS), and acceleration of Aadhaar Enabled Payment Systems (AePS). To read the complete document, click here. Oversight and Expansion Phase (Payments Vision 2009-2012) Payments Vision Document 2009-2012 pivoted towards operational efficiency, safety, and inclusion. It underscored the need for systems that are safe, secure, efficient, authorised, and accessible, aligning domestic oversight with international standards. During this phase, NEFT and RTGS systems were expanded, electronic transactions gained traction, and the RBI enhanced its supervisory role over Financial Market Infrastructures (FMIs). To read the complete document, click here. Institutional and Regulatory Phase (Payments Vision 2005-2008) The 2005-2008 Vision document focused on building the institutional and legal infrastructure to support a rapidly evolving payment ecosystem. It led to the creation of the Department of Payment and Settlement Systems (DPSS) within the RBI in 2005, thereby providing a dedicated regulatory and developmental focus. The landmark RBI Payment and Settlement Systems Act, 2007, and the PSS Regulations, 2008, granted statutory authority to the RBI to regulate and supervise all payment systems. This document also envisaged an umbrella organisation for retail payments, leading to the establishment of the National Payments Corporation of India (NPCI) in 2008. To read the complete document, click here. Foundational Phase (Payments Vision 2001-2004) The document laid the foundation for a modern, technology-driven payment infrastructure. At the time, India’s payments were dominated by paper instruments, primarily cheques. The document emphasised consolidation, efficiency, and security, aiming to shift towards electronic modes and centralised settlements. Key milestones included the launch of the Real-Time Gross Settlement (RTGS) system in 2004, the expansion of Electronic Clearing Services (ECS), and the early development of the Cheque Truncation System (CTS). Source : RBI