Union Budget 2021: Finance Minister proposes Rs 1,500 Crore Scheme to boost Digital Payments

Union Budget 2021

Union Finance Minster Nirmala Sitharaman tables India’s first paperless budget on Monday where she proposed Rs 1,500 crore-scheme to boost digital payments in the country. Finance Minister Nirmala Sitharaman stated that there has been a major increase in e-payments  payments in the recent past.

“To give a further boost to digital transactions, I earmark Rs 1,500 crore for a proposed scheme that will provide financial incentive to promote digital mode of payment,” said the Union minister while presenting the Budget for 2021-22.

The BFSI sector has given thumbs up to this move and industry experts are quite elated with the announcement.

Industry Reactions

Bhavin Turakhia, Co-founder and CEO, Zeta

“We welcome the announcement by our honorable Finance Minister Ms. Nirmala Sitharaman to introduce an INR 1,500 crore-scheme that will provide financial incentives to promote digital mode of payments. This move will help in enhancing financial inclusion and building a contactless economy in the country. The unprecedented pandemic gave digital payments adoption a much needed boost and this year will be a landmark for India in terms of taking definitive steps towards using the power of digital technologies. We expect that this investment will encourage both Private and Public Sector banks, FIs and fintechs to adopt modern technologies so they can provide future ready, mobile-first, secure and state-of-the art digital products and services to customers.”- Bhavin Turakhia, Co-founder and CEO, Zeta. 

 Gaurav Shinh, Founder & CEO, DAAS Labs

The Budget 2021-22 has left the data science community quite excited for what is to come. For me it was really interesting when the Government announced that it will launch multiple data analytics, AI, ML driven models for e-security, e-education, e- consultation, and compliance management. Also, the prospect of using Artificial Intelligence and Machine Learning in GST Fraud Tracking is quite motivating and intriguing.

Also Read: Union Budget 2021 | Finance Minister announces increase in FDI limit on insurance, PSB recapitalisation, Asset Reconstruction and more

The Government’s continued support for the startup is quite uplifting as the Government is setting aside Rs 15,700 crore in FY22 and has reduced margin money requirement from 25% to 15% for startups. The proposal of extending the tax holiday for start-ups by one more year will also give more confidence to the entrepreneurs.

 Anil Kumar N.S., Co-Founder & MD of Aeldra 

It is heartening to see some of the budget announcements like Fintech-hub at GIFT city and 1500Cr push for digital payments that show the Government’s acknowledgment of fintech being the flagship of the startup ecosystem in India. Fintech is and will be one of the fastest-growing sectors in India at almost 23% CAGR over the next 5 years and will be a major driver of growth as well to generate the 90 Million jobs required in India over the next 5-10 years (as per a recent McKinsey Survey). With the revival in consumer sentiment, spending and investments, we see an uptick in hiring ourselves and faster roll-out of our innovative products. We clearly expected more push towards the adoption of technology in banking and more allocation towards innovations in fintech. Easing regulatory clearances for cross-border inflows and outflows of funds and rationalization of FEMA will help accelerate further growth.

Also Read: Live: Union Budget 2021 Live Updates

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