For assessing the extent of digitization in India, and innovation in the existing modes and channels for bridging digital divide, the highest banking authority in India, Reserve Bank of India (RBI) is on the verge of constructing a digital payment index. It has been informed by a senior official of RBI on Wednesday.

The initiative by RBI is after observing the digital payments in India increasing rapidly. The Executive Director of RBI, T Rabi Sankar, at a webinar by US-India Business Council, said, “There is still a lot of catching up to do as per-capita penetration is still quite low. RBI is in the process of...constructing and periodically publishing a composite digital payment index (DPI) to capture the extent of digitisation. The DPI could be the key to accurately measure the deepening and penetration of digital payments across the country.”

Headed by Nandan Nilekani, a comprehensive index has been recommended by a high-level committee, which will ensure rooted digital payment processing in India.

In the beginning of the year, in the first half of February, RBI said, “The DPI would be based on multiple parameters and shall reflect the penetration and deepening of various digital payment modes.”

Sankar said, “Financial inclusion is well recognised as a key driver of economic growth.”

While 50 percent of the total population in the growing economy is still fighting against financial crisis, providing access to formal finance will boost jobs and economic resilience, leading to reduction in poverty and economic imbalance.

Sankar said, “Digital technologies offer most-effective channel to deliver finance to these underserved population.”