According to Reserve Bank Deputy Governor Michael Debabrata Patra, India is undergoing rapid digital transformation. In the banking sector, digital banking platforms, mobile banking apps and online services are reducing cash dependency and furthering financial inclusion. Several FinTech companies and digital lending platforms offer quick and hassle-free loans to individuals and businesses, using data analytics and AI to assess creditworthiness.
The success of the Unified Payments Interface (UPI) has been a game-changer, making it one of the fastest-growing digital payment platforms globally. Other developments include the central bank digital currency (CBDC) project or e₹ which has the potential for transforming not only the payments landscape, but also the wider financial system. Digital supply chain finance (DSCF) is another emerging segment which seeks to integrate digital financial services into the supply chain, facilitating smoother transactions, reducing risks and enhancing overall efficiency. Digital technologies are also being used in insurance, capital markets and in expanding rural and urban connectivity and access to digital financial services.
According to the Ministry of Electronics and Information Technology, India could become a US$1 trillion digital economy by 2025, with digital financing needs of around 2.3 per cent of GDP.29 Extrapolating from this near-term goal, the size of Indias digital economy in 2047 would be in the range of US$ 5.4 to 6.9 trillion, and the digital infrastructure financing gap would work out to around US$ 124-159 billion by 2047.30
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