Cashless India

Union Budget (2017-18): Promoting Digital Payments (Digital Economy) towards less-cash society dated 1st Feb 2017

Digital Economy – Budget 2017

Digital Economy is one of 10 central themes for Budget-2017 for establishing speed, accountability and transparency in the system.

DIGITAL ECONOMY

  • 125 lakh people have adopted the BHIM app so far. The Government will launch two new schemes to promote the usage of BHIM; these are, Referral Bonus Scheme for individuals and a Cashback Scheme for merchants
  • Steps would be taken to promote and possibly mandate petrol pumps, fertilizer depots, municipalities, Block offices, road transport offices, universities, colleges, hospitals and other institutions to have facilities for digital payments, including BHIM App
  • Aadhar Pay, a merchant version of Aadhar Enabled Payment System, will be launched shortly
  • A Mission will be set up with a target of 2,500 crore digital transactions for 2017-18 through UPI, USSD, Aadhar Pay, IMPS and debit cards.
  • A proposal to mandate all Government receipts through digital means, beyond a prescribed limit, is under consideration.
  • Banks have targeted to introduce additional ₹10 lakh new POS terminals by March 2017. They will be encouraged to introduce ₹ 20 lakh Aadhar based POS by September 2017.
  • Proposed to create a Payments Regulatory Board in the Reserve Bank of India by replacing the existing Board for Regulation and Supervision of Payment and Settlement Systems.

PROMOTING DIGITAL ECONOMY

  • Under scheme of presumptive income for small and medium tax payers whose turnover is upto ₹ 2 crores, the present, 8% of their turnover which is counted as presumptive income is reduced to 6% in respect of turnover which is by non-cash means.
  • No transaction above ₹ 3 lakh would be permitted in cash subject to certain exceptions
  • Cash expenditure allowable as deduction, both for revenue as well as capital expenditure, to be limited to Rs 10,000. Similarly, the limit of cash donation which can be received by a charitable trust is being reduced from Rs10,000/- to Rs 2000/-.
  • Miniaturised POS card reader for m-POS (other than mobile phones or tablet computers), micro ATM standards version 1.5.1, Finger Print Readers / Scanners and Iris Scanners and on their parts and components for manufacture of such devices to be exempt from BCD, Excise/CV duty and SAD.
  • Increased digital transactions will enable small and micro enterprises to access formal credit. Government will encourage SIDBI to refinance credit institutions which provide unsecured loans, at reasonable interest rates, to borrowers based on their transaction history.
  • The digital payment infrastructure and grievance handling mechanisms shall be strengthened. The focus would be on rural and semi urban areas through Post Offices, Fair Price Shops and Banking Correspondents.
  • Steps would be taken to promote and possibly mandate petrol pumps, fertilizer depots, municipalities, Block offices, road transport offices, universities, colleges, hospitals and other institutions to have facilities for digital payments, including BHIM App.
  • A proposal to mandate all Government receipts through digital means, beyond a prescribed limit, is under consideration.
  • Government will consider and work with various stakeholders for early implementation of the interim recommendations of the Committee of Chief Ministers on digital transactions.