Government directs banks to install 10 lakh new PoS terminals by March 31

New Delhi: To facilitate move towards cashless transactions and help fight against corruption following the demonetisation move, government on Tuesday directed banks to install 10 lakh new PoS terminals by March 31.

To facilitate move towards cashless transactions, government directs banks to install 10 lakh new PoS terminals by March 31.

— Press Trust of India (@PTI_News) December 6, 2016

The move by the government comes following reports that banks were also planning to add 10 lakh PoS devices by March end.

"As part of the plan to expand the digital payments ecosystem and facilitate the move towards cashless transactions, the government has decided that an additional one million new PoS terminals should be installed by March 31," it said.

To encourage purchase of PoS machines, the excise duty payable on acquisition of POS machine which was earlier 16.5 percent has been waived till March 31.

The statement further said a special drive has also been undertaken jointly with Ministry of Labour & Employment and States' Administration to open banks accounts for unorganised labour by holding camps at various locations.

A total of 2,73,919 camps have been organised so far in which 24.54 lakh accounts have been opened.

In the light of the government's decision to demonetise Rs 500/1000 from November 9, banks are making all out efforts to facilitate genuine transactions.

"Appropriate action is being taken against individuals involved in irregular and unauthorised activities. Since 3rd December 2016, action against 7 officials of Public Sector Banks (PSBs) have been taken," it said.

Besides, audit has been taken-up in few branches of PSBs, it said, adding that the concurrent audit is also being initiated as per the requirement and under the extant guidelines of RBI.

Following the demonetisation move and the cash crunch that follow, the government has encourage the public to go cashless, a move that will even prevent corruption.

With the old Rs 500 and Rs 1000 being invalid now, people are finding it hard to get changes for the new Rs 2000 note while there is insufficient new Rs 500 notse in the banks.

The Indian Express quoted a senior official of the finance ministry as saying, “The number of PoS terminals is very low at present, as compared to the number of retail merchant establishments (1.5 crore) and small and medium enterprises (3.6 crore).”

Over 80 percent of the transactions in Indian economy are conducted in cash, in contrast to developed countries average of around 20 percent, The Indian Express report added.