New Delhi: The government has recently invited proposals from startups and fintech firms to create solutions that will be required digital payment in semi-urban and rural areas of India. It gave companies until September 15 to submit detailed project ideas, and will now narrow down and fund the best ideas.

The government said it is exploring things like voice-based digital payment solutions using mobile phones; Local language apps for digital payments; and solutions for digital payments using feature phones. It said these are some of the areas in which previous efforts have been unsuccessful and require a new, innovative approach.

Other areas include increasing the use of digital payments by women and people with disabilities; and bridging the digital gap in excluded areas such as Jammu and Kashmir, Ladakh, Tier-III cities and beyond.

“Digital payment penetration and presence of digital players is substantial at various locations in India, but still lacking in terms of adoption due to challenges of internet availability, awareness and demographics in northeastern states, Ladakh, J&K and rural areas,” The Ministry of Electronics and IT said in its call for proposals. “While there has been phenomenal growth in digital payments, the potential is huge. Cash continues to dominate the Indian markets. There is a need to accelerate the adoption of digital payments across the country.”

While many companies are already working on addressing some of these issues, the government is looking at promoting these technologies in a big way.

For example, ET reported earlier this month that tonetag, which is supported by Amazon and MasterCard,
Working to enable voice based payments About 50,000 in villages and small towns. This feature will allow people to use their voice in their own language to perform UPI-based transactions using the phone.

A report published by Kantar & Dialog Factory earlier this month, called ‘Rural Covid Barometer’, said there has been a significant increase in digital payments in rural areas. It provides a strong platform for rural financial inclusion as well as suitable hyperlocal promotion. NS reserve Bank of IndiaThe Annual Report of 2020-2021 also states that the COVID-19 pandemic has propelled the country towards digital payments.

The ministry’s call for proposals also noted that there has been an increase in digital payment transactions over the years. It said the total transaction volume increased from Rs 2,071 crore in FY18 to 5,554 crore in FY21, and that the DigiDhan mission aims to drive digital transactions to Rs 6,000 crore in the current fiscal. It also noted that digital payments are keeping the economy running amid the pandemic and helping people reduce exposure to the virus, before more needs to be done.