India moving to a biometric payment system by 2020?
India’s people and economy are still adjusting to the Nov. 8, 2016 ban on 500 and 1000 rupee notes (apx. $7.50 and $15.00 value in U.S. currency). At that time 95% or more of all transactions in India were cash transactions, 90% of vendors were only able to accept cash payment, and 85% of workers were paid exclusively in cash.
This bold economic move was meant to encourage a swift transition from a cash economy to a system of digital electronic payments. It was also intended to curb to corruption such as black markets, tax evasion, money laundering and counterfeiting. It is rumored that Pakistan was a source of counterfeit currency intended to fund terrorism.
Amitabh Kant, a leader of India’s top economic development agency, speaking recently at the World Economic Forum, told listeners that India could introduce a biometric payment system within three years that would render cash, as well as credit cards, obsolete.
Nearly 1.1 billion of India’s 1.3 billion people have already registered their biometric data with the government's biometric identification system. India is currently testing a biometric payment app that works with portable fingerprint scanners. Digital payments have indeed received a massive boost from the cash ban, but as less than 30% of Indians own a smart phone, there is much more work to be done.
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