Reserve Bank of India on prepaid instruments in India (via BIS), more Jugaad needed.
What does Jugaad mean?
Sometimes jugaad means a band-aid solution to a problem (with its negative connotations) however, often jugaad is the creative improvisation to make things work. And, in Indian economy jugaad is needed constantly to get things done.
Per RBI, one of the biggest Indian jugaad has been “missed call” services on mobile phones – meta messaging services where a message gets delivered or transaction gets completed without the caller or called incurring any SMS or call charges e.g. ZipDial service. Remember most mobile phones are still basic feature phones in India i.e. on a percentage basis, there is very little mobile Internet.
In India, cash is still the medium of choice for transactions. Reserve Bank of India in its goal of a less-cash society is encouraging the use of prepaid instruments. However, they find that the percentage of prepaid instruments issued so far
Paper vouchers 73.4%
Magstripe cards 16.59%
Paper cash is being replaced by more paper – vouchers. Paper still dominates financial transactions.
Therefore RBI’s call for more jugaad by prepaid payment processors that would go towards less use of cash.
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