A regional government in India has launched an initiative to promote digital payments and drive financial inclusion in rural areas.
The Andhra Pradesh government is working alongside Canara Bank, which is one of India’s largest public sector banks, and the National Payments Corporation of India (NPCI), the umbrella organisation for retail payments, to enable and encourage citizens to make and receive cashless state payments using QR (‘Quick Response’) codes: squares of black and white blocks that are scanned by smartphones.
The initiative, which sees the introduction of the Unified Payments Interface (UPI) QR code in more than 15,000 ‘villages and wards’, was launched by the chief minister YS Jaganmohan Reddy last week.
Citizens seeking to take advantage of the scheme, for example to receive a benefits payment, require a government official generate a QR code on their computer screen. The citizen then uses his or her mobile phone to scan the QR code on any UPI-enabled application to authenticate and instantly receive the payment.
The scheme is being launched for 35 government departments and for the provision of more than 500 services, according to a short film accompanying the launch.
“I am confident that UPI will enable numerous villagers to perform convenience and hassle-free cashless transactions,” said Jaganmohan Reddy, adding that the aim was to launch digital payments in further localities within the region.
‘Garnering momentum during the pandemic’
India is reported to have suffered more than 50,000 deaths due to COVID-19, with the death toll in Andhra Pradesh reported this week as being more than 3,500.
The importance of UPI has surged during the pandemic, according to the NPCI as it announced details of its involvement in the Andhra Pradesh initiative.
UPI has been “the beacon of hope to promote financial inclusivity in the country and has garnered tremendous momentum, especially during the pandemic”, NPCI managing director and chief executive Dilip Asbe said.
“This first-of-its-kind initiative will not only reduce the time spent by villagers waiting in serpentine queues but also ensure secure, instant and contactless payments especially amid [the] Covid-19 outbreak,” the government said, according to an Economic Times report.
Authorities in India, led by Prime Minister Narendra Modi since 2014, have been striving to bring more of its vast population of more than 1.3 billion into the banking system. In 2015 the government launched its ‘Digital India’ campaign, which involves improvements to digital infrastructure, digital literary and delivering services digitally.
But challenges remain given the size of the country. More than 2,000 villages in Andhra Pradesh struggle with basic mobile connectivity, according a media report earlier this year.
The Andhra Pradesh government is also using QR codes as part of its public health response to coronavirus. Citizens are able to check the availability of beds in the 138 hospitals across the state by scanning a QR code, according to a report earlier this month.
QR codes are being increasingly encouraged by governments worldwide to enable cashless payment. Global Government Forum reported last year how Ghana had committed to rolling out a universal QR code, as the West African country’s government looked to accelerate the take-up of e-payments.