RBI constructs index to capture digital payments penetration in country

RBI has constructed a composite digital payments index (DPI) with March 2018 as the base period to capture the extent of digitisation of payments across the country

The Reserve Bank of India on Friday said it has constructed a composite Digital Payments Index (DPI) with March 2018 as the base period to capture the extent of digitisation of payments across the country.

"The DPI for March 2019 and March 2020 work out to 153.47 and 207.84, respectively, indicating (an) appreciable growth," it said in a statement.

Going forward, RBI-DPI will be published on the central bank's website on a semi-annual basis from March 2021 onwards with a lag of four months.

The RBI-DPI comprises of five broad parameters that enable measurement of deepening and penetration of digital payments in the country over different time periods.

The parameters are payment enablers (weight 25 per cent), payment infrastructuredemand-side factors (10 per cent), payment infrastructure supply-side factors (15 per cent), payment performance (45 per cent) and consumer centricity (5 per cent).

Each of these parameters have sub-parameters which, in turn, consist of various measurable indicators, RBI said.

The RBI-DPI has been constructed with March 2018 as the base period, meaning DPI score for March 2018 is set at 100.

Digital payments in India have been growing rapidly.

Earlier in February, RBI had announced it will construct and periodically publish a composite DPI to capture the extent of digitisation of payments effectively.

The objective of DPI is to reflect accurately the penetration and deepening of various digital payment modes.