India’s Digital Boom: From UPI to 5G, How India is Becoming a $1 Trillion Digital Economy by 2028
India’s financial ecosystem is transforming rapidly due to digital initiatives, deep internet penetration, and affordable 4G and 5G services. A report by Ask Capital predicts India will become a $1 trillion digital economy by 2028.
Government Initiatives
Government programs like Pradhan Mantri Jan Dhan Yojana (PMJDY) and Direct Benefit Transfer (DBT) have enhanced financial inclusion. Increased mobile and broadband penetration will deepen financial inclusion and boost new digital services.
Digital Payments
Digital payments, driven by UPI, are expected to reach $10 trillion by 2026. The digital economy’s contribution to GDP is projected to rise from 4.5% in 2014 to 20% by 2026. Retail digital payments surged 50.8% between 2017 and 2023.
Technological Advancements
India has become a global example of real-time payments, benefiting from homegrown technological innovations like UPI. The RBI is planning to roll out the Unified Lending Interface (ULI) to simplify credit access, especially for small and rural borrowers.
Impact on Various Sectors
Sectors like finance, education, healthcare, food, travel, and e-commerce are undergoing large-scale digital transformation. Healthcare schemes like Ayushman Bharat Digital Mission (ABDM) and e-Sanjeevani are making healthcare more accessible. In education, digital classrooms have become the norm post-Covid-19.
Future Prospects
The e-commerce sector is expected to be a key driver for growth, leading to a surge in digital payment transactions in rural areas. The report says digital payments in India are about to reach an inflection point and are expected to grow in value to $10 trillion by 2026.
With a large pool of talent and the government’s thrust on digitalisation, India is expected to propel towards becoming a $1 trillion digital economy by 2028.
Doubts Revealed
UPI -: UPI stands for Unified Payments Interface. It’s a system that allows you to transfer money between bank accounts instantly using your mobile phone.
5G -: 5G is the fifth generation of mobile network technology. It is much faster than 4G and allows for quicker internet speeds and better connectivity.
$1 Trillion -: A trillion is a very big number. It is 1 followed by 12 zeros (1,000,000,000,000). When we say $1 trillion, we mean a thousand billion dollars.
Digital Economy -: A digital economy is one where most of the economic activities are done using digital technologies, like the internet and mobile phones.
Ask Capital -: Ask Capital is a company that provides financial advice and research. They study markets and predict future trends.
PMJDY -: PMJDY stands for Pradhan Mantri Jan Dhan Yojana. It is a government program in India that aims to make sure everyone has a bank account.
DBT -: DBT stands for Direct Benefit Transfer. It is a system where the government sends money directly to people’s bank accounts to help them.
Financial Inclusion -: Financial inclusion means making sure everyone has access to useful and affordable financial services, like banking and insurance.
GDP -: GDP stands for Gross Domestic Product. It is the total value of all goods and services produced in a country in a year.
Internet Penetration -: Internet penetration means how many people in a country have access to the internet. High penetration means many people can use the internet.
