The Reserve Bank of India (RBI) has revealed a remarkable 12.6% increase in digital payments across the nation as of March 31, 2024. This growth, as indicated by the RBI's Digital Payments Index (RBI-DPI), underscores the expanding adoption of online transactions in India.

The RBI-DPI, a key metric for gauging digital transaction growth, showed an increase to 445.5 by the end of March 2024. This is a significant rise from 418.77 in September 2023 and 395.57 in March 2023. The index reflects a positive trend across all its components, attributed to substantial improvements in both payment performance and infrastructure.

The RBI highlighted in a recent statement that the overall rise in the RBI-DPI index is driven by advancements in payment systems and the expansion of infrastructure throughout the country. The central bank had initially launched the composite RBI-DPI in March 2018 to monitor the extent of digital payment adoption in India.

The RBI-DPI is built on five main parameters:

• Payment Enablers (25%) - Factors that facilitate the use of digital payments.
• Payment Infrastructure - Demand-side Factors (10%) - Elements influencing the demand for digital payment systems.
• Payment Infrastructure - Supply-side Factors (15%) - Aspects affecting the availability and supply of payment infrastructure.
• Payment Performance (45%) - Measures of how effectively digital payments are executed.
• Consumer Centricity (5%) - Focus on how digital payment systems cater to consumer needs.

The index is updated semi-annually, with the latest data released four months after the end of each period.

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