Banking

Govt announces free online transactions till Dec 31

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online-paymentsThe government has announced free online transactions till December 31 along with a number of other measures in a bid to ease up the burden of demonetisation on the common man.

The government has also asked the National Bank for Agriculture and Rural Development (NABARD) to sanction Rs 21,000 crores to cooperative banks, making new denomination notes available at 1.5 lakh post offices, doubling e-wallets’ capacity and paving the way for service charge free electronic transactions on feature phones too.

The announcement means that there will no service charges for using debit card and buying railway ticket online till December 31.

These measures will benefit not just people who have smart phones but also those who have the simple feature phones. As many as 65% of mobile phones in India are the simple feature phones.

Speaking on the issue, Economic Affairs Secretary Shaktikanta Das, said, “A cascading effect of service charge reduction will lead to these free online transactions.”

The railways recently announced that there will be no service charge on online booking of tickets till December 31.

TRAI has also reduced USSD (Unstructured Supplementary Service Data) charges to 50 ps from RS 1.50.

“These will benefit digital transactions through feature phones… The USSD charge reduction will be matched by telecom companies which are on board to waive even the remaining 50 ps. So, for all digital finance transaction on feature phones there will be no service charge till December 31,” Das told the media.

The government has decided to take these measures to benefit farmers and to promote digital transactions, Das added.

“To ensure that farmers get credit and certain quantum of credit by way of cash (for wage payments, etc.), NABARD and RBI have also been advised to make the required cash available to district central cooperative banks,” Das said.

Finance Minister Arun Jaitley held a video-conference call with NABARD and the RBI and advised them to carry out whole chain of activities smoothly.

In addition, 82,000 ATMs around the country have been re-calibrated so far. “So, it’s only a matter of few days (that) all the ATMs will be re-calibrated,” Das said.

He also announced a pilot programme is underway in 20 banks that are using a new Unified Payment Interface mobile phone application (app). This app will enable not just making payments but also getting payments, all instantly, in real time. The transaction limit in using this app is Rs 50,000.

The Highways Ministry has also informed all vehicle makers to make new vehicles equipped with ECF-compliant RFID facility, so that highway tolls can be collected electronically.

“This also means no queues,” Das explained.

All government organisations have been advised to use only digital payment methods soon.

“The whole background of demonetisation…one of the positive outcomes… is we are seeing a large migration to digitisation. Public sector banks say there’s a great surge in demand for prepaid debit and other cards,” Das said.

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