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Growth of Digital Payments and the emergence of FinTech in India

The government of India has proved to be a catalyst in the growth of the digital payments ecosystem in the form of modernization of payment infrastructure, digital literacy and offering ease of setting up a business. The government pushed a surge of digital inclusion in the country with subsidies, programs and incentives including:

  • BHIM cashback and referral bonus scheme1.
  • Subsidy on digital payments, in the form of 10% discount on payments for rail tickets, highway toll fees and insurance policies2.
  • Facilitating UPI transactions to accept payments without any MDR (Merchant Discount Rate)3.
  • Service Tax exemption for different categories4.
  • Launch of e-wallet services by different states (T-wallet by Telangana5, Bhamashah wallet6 by Rajasthan, etc.)
  • Launch of NCMC (National Common Mobility Card) for toll and transit payments7.
  • Mandating FASTags for all vehicles for highway toll collection8.
  • Issuance of virtual payment addresses by India Post Payments bank.
  • DigiDhan Abhiyaan, the outreach campaign enrolling over one crore rural citizens for digital payment methods9.
  • Interoperability between digital payment wallets10.
  • Digital literacy programs including Pradhan Mantri Gramin Digital Saksharta Abhiyan11, Lucky Grahak Yojana, Digi-Dhan Vyapar Yojana, DigiVaarta12, etc.
  • Funds transfer facility through NEFT around the clock on all days including weekends and holidays13.


[1]: Launch of Referral and Merchant Cashback scheme for BHIM users, NPCI, June 2017
[2]: India’s discounts for online payments a global first, Livemint, December 2016
[3]: No extra charge on digital payments via RuPay, UPI from Jan, The Hindu, Dec 2019.
[4] No service tax on credit, debit card transactions up to ₹2,000, TheHinduBusinessLine, Jan 2018
[5] T Wallet- Anytime Anywhere digital payment option for Everyone, Government of Telangana, July 2019
[6] Bhamashah Wallet, Inc42, August 2018
[7] National Common Mobility Card, Press Information Bureau, July 2019
[8] FASTag to be mandatory from December 15, EconomicTimes, November 2019
[9] DigiDhan Abhiyan, Digital India, January 2017
[10] RBI releases norms for facilitating money transfer among e-wallets, EconomicTimes, October 2018
[11] Pradhan Mantri Gramin Digital Saksharta Abhiyan, Digital India, January 2018
[12] DigiVaarta to popularize Digital Payments, Press Information Bureau, September 2018
[13] Transfer money via NEFT 24×7 from Dec 16, EconomicTimes, December 2019

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