PM Modi’s Initiatives Strengthened Digital Ecosystem, Financial Inclusion: Fintech Leaders

India's digital payments and fintech ecosystem has strengthened significantly over the past decade as initiatives under Prime Minister Narendra Modi's leadership helped expand financial services and create opportunities for young entrepreneurs, industry leaders said on his 76th birthday on Thursday. In an interaction with IANS, MobiKwik CEO Bipin Preet Singh said the startup, digital and payments ecosystem had moved into the mainstream since Modi became prime minister in 2014.

The expansion over the past 12 years has brought more companies into the sector, improved access to financial services and contributed to changes in people's lives, Singh said. He also said India's Unified Payments Interface (UPI) ecosystem had helped the country emerge as a global leader in real-time payments. On the proposed UPI Merchant Discount Rate (MDR), Singh said introducing a charge on eligible merchant transactions would help improve the sustainability of the payments ecosystem, which involves costs for banks and financial companies.

Meanwhile, PhonePe CEO Sameer Nigam also congratulated Modi and described him as a major promoter of digital payments, startups and Digital India. Nigam said government initiatives over the past 13 years had created a foundation that helped more young people pursue entrepreneurship. Clarifying the impact of UPI MDR, Nigam said customers would continue to use UPI without any charges.

“Customers have never been charged for using UPI and they will not be charged in the future,” he told IANS. He said small merchants with annual turnover below Rs 1 lakh would remain outside the MDR framework. In addition, 96% of transactions at large merchants are below Rs 2,000 and would not attract the proposed charge, he said. For eligible merchant transactions above Rs 2,000, an MDR of 0.4 per cent would apply and the charge would be borne by merchants, not customers, Nigam said.

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