Cybersecurity, customer protection essential for digital payments momentum: RBI paper

economictimes.indiatimes.com:

Cybersecurity, customer protection, and cost-effectiveness are essential for sustaining the momentum towards digital payments pushed by the Covid pandemic, said Reserve Bank paper on Tuesday.
The transactional use of cash has been on a decline and is increasingly getting substituted with digital modes of payments, even as the store-of-value role of cash remains intact, said the paper titled 'Cash versus Digital Payment Transactions in India: Decoding the Currency Demand Paradox'.

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In line with the global evidence, the pandemic led to a transitory uptick in currency demand in India driven primarily by precautionary and store-of-value motives.
To sustain the momentum towards digital payments initiated by the pandemic, concerted efforts are needed to ensure the cost-effectiveness of payment modes and relevant acceptance infrastructure from both the demand (consumers) and supply sides (merchants and intermediaries); and ensure universal access to enablers, such as smartphones and internet connectivity, it said.
The paper authored by Sakshi Awasthy, Rekha Misra and Sarat Dhal, all associated with RBI's Department of Economic and Policy Research (DEPR), further said efforts are needed to bolster financial inclusion and literacy; and safeguard cybersecurity and customer protection.
The authors further said that despite the traction observed in digital payments, cash persists due to a strong inclination of the populace to transact and save in cash.
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