Over the past two weeks or so through the course of repeated dialogues and debates on the merits and demerits of demonetisation, one aspect has always taken the centre stage. The internet penetration of our country is far lower than anticipated and the access to smart phone is still more of an urbane phenomenon? Needless to mention even I was probing this issue and was exploring the various alternatives available when I stumbled on this whole initiative that makes it possible to make transactions digitally without the need of a smart phone or internet.
Well the answer is incoporating the use of USSD technology. USSD in simple terms refers to a supplementary service data which is predominantly unstructured. Instead of the internet, this system uses the GSM channel that you use for your regular calls to transmit information. Essentialy this service is therefore available on any phone that can send a simple SMS. Ir works in a way that facilitates channels of communication across of gamut of services including banking. Your telecom operator as well as the bank you are dealing with partner with the end reciver to facilitate the communication to you. In India, the National Unified USSD Platform or NUUP is a mobile banking service based on USSD.
This USSD based data services enables fund transfer via MMID, IFSC code or even Aadhar number apart from generating mini statement and checking account balance. One must however remember that NUUP essentially used the IMPS platform for its fund transfer feature, therefore a transaction once approved happens immediately and there is no scope of reversing it. Perhaps in a way this can be even more advantageous as against a bank transaction happening over the internet through your laptop which has the risk of getting cancelled if the connectivity channels are not established appropriately. One must remember though that this payment can be only used for transactions upto Rs 5000 as per the country’s Reserve Bank.
The National Payment Corporation of India looks at improving the country’s financial inclusion through this move as many low income groups with no access to internet or a smart phone can also now use this mode of transaction to address their banking needs. The fact that it is functional even on holidays and festivals is no doubt an additional advantage.