Digitalization is the utilization of advanced innovations to change a plan of action and give new income and esteem delivering openings; it is the way toward moving to a computerized business. India is the fastest developing economy of the world. The Indian economy is the seventh biggest economy of the world in terms of GDP and third biggest by purchasing power parity (PPP) after US and China. The Indian economy has seen a great deal of changes from acting self-dependent to opening its entryway for worldwide exchanging by introducing LPG (Liberalization, Privatization and Globalization) in 1991 under the Finance Minister Mr Manmohan Singh.
And from that point of time, India is growing at a great pace. As indicated by the most recent Economic Survey 2015-16, the Indian economy will keep on growing more than 7% in 2016-17. As indicated by Fitch Ratings Agency, India’s Gross Domestic Product (GDP) will probably develop by 7.
7% in FY 2016-17 and gradually increase to 8% by FY 2018-19, driven by the gradual usage of changes in the economy, higher disposable income and change in financial action. The current strides of the Indian government have indicated positive outcomes in the growth of the GDP. As indicated by a Goldman Sachs report in September 2015, India could develop at a potential 8% from financial 2016 to 2020 if provided great implementation of advancement in the banking sector, technology adaptation, urbanization and other changes.The 1990s likewise observed the passage of innovation in India and individuals started using PCs and computerization overwhelmed each area and now we can see the virtual world that exists and anything can occur in it from joining the world to start a war if not took care of legitimately.
But in a developing country like India the process of digital soundness has been moderate and got a tremendous push to go computerized when the demonetization shook everybody. In spite of the fact that there have been different activities taken by our Honorable Prime Minister Mr. Narendra Modi, for example, Make In India, Swatch Bharat Abhiyan, Digital India and so forth. However, it was during cash crunch when individuals began perceiving the advantages of being carefully stable and how valuable it is.
Our administration has accentuated continuous cashless as it will make exchanges smoother and transparent and dispenses with the presence of parallel economy which postures risk to the peace in our nation and furthermore helped in their financial inclusion plan and has seen that demonetization has made the accounts opened under Pradhan Mantri Jan Dhan Yojana operational. As appropriately said by Rajat Gandhi on financial inclusion “Regardless of what number of banks may open and what number of boots you have on the ground, if the individual does not know about the financial options that are available to him, policies, plans and budgetary instruments will mean pretty much nothing. It is necessary for a man to comprehend what to search for and know about the advantages that he can get from it. “Thus this makes the financial knowledge related education all the more vital. Financial inclusion is a quantitative term and financial literacy is more about the quality.
Financial literacy concentrates on the understanding one ought to need to how to utilize and deal with the money effectively and lessen the risk and save their money from ecological changes, for example, changes in the economy, inflation and so forth. With the demonetization individuals have likewise acknowledged how essential it has progressed for them to think about their money and what influences it the most and how they can secure. At this stage digital mindfulness has likewise picked up significance and individuals are additionally ready to take in the new modes accessible for them to deal with their money in the cashless way.
During this time the online payment methods have helped individuals to survive the cash crunch they confronted and have additionally turned into the main impetus for digital literacy and financial literacy. Objective of the studyTo study the steps taken towards digitalization in India and its impact on Indian Financial System. Research MethodologyThe investigation is exploratory and quantitative in nature. The secondary data is utilized for the analysis of the issue.
Sources for the secondary information are started from the different sources like investigation report, newspaper, articles and Reserve bank of India (RBI) sites.Digitalization and GDP GrowthEffect of digitalization on a nation can be surveyed based on its effect on the government, on the economy and the general public. We have seen a noteworthy change in each division with the rise of digitalization. The digitalization has made new openings for work, have prompted development in extremely segment and furthermore prompted the development of the economy i.e. have helped in the GDP growth of the nation. The government has stressed on the digitalization as it brings transparency, better control, better openings for work, it likewise gives an ease of access to the general population and an upward development in the quality of life. The study led by Strategy & (formerly known as Booz and Company) shows that the expansion and compelling use of digitalization can increase their GDP.
They indicated that constrained economies face 0.5% expansion in GDP per capita for each 10% increment in digitalization, while advanced digital economies demonstrate a 0.62% increment in GDP per capita for each 10% digitalization increment.