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This will allow customers to use mobile services without disruption and ease their anxiety, allowing them continuous communication, telephony being an essential service.
Commenting on the positive move, COAI Director General Rajan Mathews said: "We are delighted that the Government acceded to our request prioritising consumer interest, so that citizens can continue to top-up and use mobile phones, which are an essential service. COAI thanks the Prime Minister Shri Narendra Modi for leading an extremely responsive and sensitive government and congratulates the Prime Minister on this historic move. Despite initial teething problems, demonetisation will immensely benefit the nation by driving increased digital transactions, promoting transparency, boosting tax collection and ensuring social equity. COAI remains committed towards working closely with the government in furthering the government's vision of a digitally connected and fully empowered India"
Continuing the use of old Rs 500 notes as legal tender for prepaid mobile services is crucial because industry estimates indicate between 30 percent and 50 percent fall in demand as customers are still struggling with less cash in hand due to demonetisation of Rs 500 and Rs 1,000 notes.
Keeping people's interests in mind, COAI on behalf of the telecom service providers had submitted to the government that dealers and distributors should be permitted to accept the old Rs 500 and Rs 1,000 notes till adequate replacement currency is available for the daily needs of ordinary citizens.
The department of Telecommunications notification has extended the deadline for the acceptance of 500 rupee notes as legal tender for recharging prepaid phones for top ups till December 15th, 2016.
Mathews added: "Globally, empirical evidence reveals the ability to communicate instantly fosters a sense of empowerment among common people, which is imperative given the ongoing - though temporary - inconvenience customers are undergoing. It's therefore important that mobile services for prepaid users continue unabated to facilitate their daily activities."
COAI reiterated its support for Prime Minister Narendra Modi's efforts to move the country towards becoming a 'less cash' society in order to curb corruption and black money, advancing social equity and financial inclusion among all sections of society. Such measures will increase the drive towards 'Digital India', benefitting every stakeholder, including the public. The telecom industry supports such endeavours that drive banking transactions towards mobile phones, reducing the cost per transaction for all stakeholders and benefitting banking eco-systems too.
With the extension on usage of Rs 500 notes in public utilities, including mobile recharge services, prepaid dealers can continue to accept these notes till 15 December. Since the prepaid segment accounts for more than 90% of India's mobile market, the extension will help customers and dealers tremendously in continuing their daily operations.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)