Financial transactions may undergo a significant transformation as a result of the introduction of the United Payment Interface. The world of money, currencies, and financial transactions has come a long way from the seals of Mohenjo-Daro and the punch-marked coins of the sixth and seventh centuries BCE to electronic wallets today. 

A new chapter in India's dynamic financial history has begun with the April introduction of the United Payment Interface, a digital transaction system created by the National Payments Corporation of India that allows users to make payments with a single click via their smartphones. Let's review the voyage to date.

A lengthy past

There are some suggestions that the seals from Indus valley civilizations like Mohenjo-Daro and Harappa were used as currency, but the first coins in India are thought to have existed during the seventh and sixth centuries BCE. Loan documents, pay orders, and hundis were the next credit instruments to come into existence. The Reserve Bank of India's Monetary Museum claims that paper money did not become widespread until the late 18th century. The initial issuers of currency notes were private and semi-government banks, but the Paper Currency Act of 1861 granted the Indian government the exclusive right to do so.

The development of cashless payment options followed, although these still needed money to be physically present. The Bank of Hindustan first introduced checks.In order to control the issuance of currency notes and preserve reserves to promote economic stability, the RBI was formally established as India's top banking organisation in 1935 in Calcutta (now Kolkata). The British Kings and Queens were featured on the currency of the time. 

For instance, the George VI series continued to be issued until 1950, the year the Indian government introduced a new series of bank notes that featured images of the country's newly gained independence, including the Ashoka Pillar. The ongoing Mahatma Gandhi series began in 1996 and is still in production today. The Indian banking industry has seen rapid development since the late 1980s. HSBC is credited with installing the nation's first automated teller machine (ATM) in 1987.

Digital revolution

Although India received mobile phones and internet access in the 1990s, the 21st century saw a growth in internet use and smart phone ownership. Therefore, while online banking has been available in India for quite some time (ICICI is said to have introduced it in the late 1990s), the introduction of online/mobile payment systems like National electronic funds transfer, or NEFT, real time gross settlement, or RTGS, and interbank mobile payment system, or IMPS, is relatively recent.

Mobile or digital wallets, like PayTM and MobiKwik, which enable users to have an electronic wallet to which they may send money and conduct online transactions, have only been around for a few years.

We may now save time and money thanks to the many ways in which technology has improved our lives. Many of us may still recall the days when we received a pay check each month, which required us to take time off work to go to the bank, wait in line to deposit the check, and then wait for the funds to be credited to our accounts. Contrast that with how most firms transfer salaries instantly online. Similar to how we used to have to wait in line to pay our phone or power bills, we can now do it all with the simple click of a mouse or a tap of our smartphone.

Cash remains the king

Even when we exclude India's sizable black market, which is estimated to account for 20% of India's GDP, cash continues to be the most common method of payment in that country despite all these advancementsAccording to some estimates, just 6%–7% of retail payment transactions are made electronically; the remainder are made with cash or a check. In the fiscal year 2015–2016, there were 15% more coins in circulation. 

The RBI attributed this growth in its annual report to 'a cluster of state elections, aside from other frictional factors like festival-related demand and jewellers' strike.'Undisputedly, using cash is convenient since transactions happen instantly, there is no need for verification, it is available around-the-clock, and it is accepted everywhere.

 Consider the function that cash currently serves: most homes use cash to pay the wages of their domestic staff, to buy vegetables and fruits, and to make a number of other small-ticket purchases. Similarly, sending checks as payment for rent is still popular.Cash continues to be the most common form of payment because a substantial portion of the country lacks access to the Internet or smartphone ownership.

Cash may rule the world, but creating and keeping money makes it expensive. Cash also contributes to the black-money economy, corruption, and terrorism. The government and the RBI are gradually modifying how payments are made in India in light of these drawbacks of a cash-based economy. The priority given to programmes like JAM (the Jan Dhan, Aadhar, and Mobile), which facilitate direct benefit transfers, reflects the government's well-known anti-corruption and pro-technology position.