Terming payment systems as the backbone of a nation's financial infrastructure, N R Narayana Murthy, chief mentor of Infosys, on Wednesday called for widening the reach of the electronic payment system to rural areas.
Murthy was speaking at an international seminar in Hyderabad on payment and settlement systems jointly organised by Reserve Bank of India, Institute for Development and Research in Banking Technology and Bank for International Settlements. Murthy is a former member of the central board of RBI.
"According to RBI, there are about 48,000 public sector bank branches in India of which over 63 per cent are in semi-urban and rural areas. Though over 70 per cent of the branches have attained 100 per cent computerisation, real time gross settlement is available only in 23,500 branches while national electronic funds transfer covers less than 5,000 branches," Murthy said, adding that integrating semi-urban and rural areas into the electronic clearing system was critical.
McKinsey estimates that by moving completely to electronic payment systems, there could be annual savings of about $6.3
