India’s digital public infrastructure experience provides effective strategies for other central banks: RBI Governor Das

Citing the success of Digital Public Infrastructure (DPI), Reserve Bank of India (RBI) Governor Shaktikanta Das on Monday said India’s experience has provided an effective digitisation strategy for other central banks.

Speaking on the sidelines of the Global Conference on Digital Public Infrastructure and Emerging Technologies in Bengaluru, the RBI Governor said, “It can be said that DPI has enabled India to achieve a level of financial inclusion in less than a decade, which would have otherwise taken decades or even more to achieve.”

he/she further said that DPI provides a way to effectively manage critical national infrastructure.

Elaborating on the success of DPI, Das said, “In times of crisis, such as the COVID-19 pandemic, India and some other countries were able to leverage digital infrastructure for vaccination programmes and targeted transfer payments.”

Das highlighted India’s experience with DPI during his/her speech.

Elaborating on the unique approach adopted by India’s public sector to facilitate the private sector, Das said, “India’s DPI journey is a unique model, wherein the basic technical infrastructure, i.e., tech infrastructure, is built, operated and managed by the public sector, while the private sector uses DPI to create innovative customer-facing services and products. The thrill of developing DPI in the public sector is that typically the private sector would be against investing capital to create infrastructure with uncertain returns.”

“The advantage of developing DPI in the public sector is that the private sector would generally be averse to investing capital to build infrastructure with uncertain returns. Privately built infrastructure may also not be conducive to democratic access or interoperability. India’s unique approach is conducive to designing services and products that are competitive in the open market,” Das said.

Das said that at the India-led G20 summit last year, the G20 Digital Economy Working Group had developed the Global DPI Repository.

Elaborating on the benefits of DPI, Das said around 1.4 billion accounts have been opened for residents of India.

Speaking about the success of Unified Payments Interface (UPI), Das said, “The current ecosystem of digital payments in India offers a bouquet of simple, safe and secure options for businesses and individuals for instant or quick transfer of both large and small value.”

Das said, “NPCI has played a vital role in the growth of retail digital payments in India. NPCI was promoted by banks under the guidance of the Reserve Bank of India. The initial participants on the UPI platform were banks, non-bank third-party providers and the use of QR codes together popularised UPI. It has since emerged as a robust cost-effective and portable retail payment system and is attracting active interest across the globe.”