After the demonetisation of Rs500 and Rs1,000 currency notes in November 2016, most kinds of electronic transactions grew significantly. This was mainly due to the lack of physical currency in the market. At the same time, the government had also announced the launch of Bharat Interface for Money or BHIM, a Unified Payments Interface (UPI) based mobile application, to boost digital transactions. In addition, charges were waived for banking transaction of values of up to Rs1,000. While recent data on electronic transactions suggests that the growth in these transactions has slowed down, the efforts to promote them have not. According to an official of a leading public sector bank, the government is nudging banks to incentivise electronic transactions. For now, banks have responded by reducing their fund transfer charges. Peer to peer UPI transactions are currently free.
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