India has one of the highest cash-to-gross-domestic product ratios. Though India is a cash intensive nation, slowly it is settling for the cashless payments mechanism especially through mobiles. A set budget should be allotted for the smartphone sector to access and deliver revamped IT infrastructure and create more opportunities for the people.
At present, import duty on smartphones devices across categories (in the form of countervailing duty) stands at six per cent. An increased rate of import duty on these products might likely not help the companies in this sector. The import duties have to be reduced to help the companies in this segment sustain for a longer period of time.
Also to drive adoption of prepaid payment instruments, we are trying to incentivise customers in the form of bonuses and cashbacks everytime they spend. If a 5-year holiday could be provided on all direct and indirect taxes to organisations in the payment space, it would help us offer more value to the customer and therefore drive adoption. Additionally, for mPOS (Mobile point of sales) purchase, the lifetime is just two years and if the cost keeps growing upwards, this becomes a bottleneck for adoption.