Skip to main content

NPCI, NSDL in fray to develop e-wallet for exporters

By
NPCI, NSDL in fray to develop e-wallet for exporters
The National Payments Corporation of India (NPCI) and the National Securities Depository Ltd (NSDL) are in the fray for operating the proposed ewallet system for exporters under the goods and services tax (GST) regime.The government is yet to decide on the agency that will develop the notional credit system to help exporters with working capital flow.GST Network (GSTN), the information technology backbone of GST, is also being considered for this.

In the government´s push foracashless economy, NPCI developed the Bharat Interface for Money (BHIM) app for making payments, available for customers of 55 banks across the country.NSDL, the country´s first and largest depository, handles most of securities held and settled in dematerialised form.

It is also a GST Suvidha Provider, which facilitates filing of returns.The directorate general of foreign trade (DGFT) is working out the amount of credit an exporter will initially need.E-wallet is essentially a notional credit and will not hit the exchequer, as it is not backed by actual money.“The government will not have to put in anything.

It will be all notional, based on the exporter´s record with DGFT,” said Revenue Secretary Hasmukh Adhia.Based on an exporter´s past record, DGFT will decide the amount of inputs he or she is buying, based on which how much tax one will have to pay on inputs will be calculated.“You can transfer it to anyone with an e-wallet.

Even a trader can have an e-wallet and receive credit from an exporter and use it to pay GST. Notional credit can be used to pay CGST and IGST,” said Adhia.The account will be replenished when one gets the refund and will stay with him. “With this, there will be no working capital blockage and no interest liability for exporters,” Adhia added.

Exporters have complained of working capital constraints.due to the slow rate of refunds on IGST by the government.In a relief for exporters till the e-wallet becomes functional, the GST Council, chaired by Finance Minister Arun Jaitley, decided to lower the IGST for merchant export to a nominal 0.1 per cent till March 31.

In the pre GST regime, no tax was charged at the time of export.Now, IGST needs to be paid, which exporters may claim as refund while filing returns.Amid constant complaints of working capital blockage, the GST Council decided to expedite refunds for exporters.Since October 10, the government has refunded around Rs 200 crore of IGST paid on export in July, of a total claim of Rs 750 crore.

About Rs 67,000 crore has been collected as IGST, from which refunds to exporters are estimated at about Rs 2,000 crore for July and August.
The Business Standard, New Delhi, 30th October 2017

Comments

Post a Comment

Popular posts from this blog

Household debt up, but India still lags emerging-market economies: RBI

By
  Although household debt in India is rising, driven by increased borrowing from the financial sector, it remains lower than in other emerging-market economies (EMEs), the Reserve Bank of India (RBI) said in its Financial Stability Report. It added that non-housing retail loans, largely taken for consumption, accounted for 55 per cent of total household debt.As of December 2024, India’s household debt-to-gross domestic product ratio stood at 41.9 per cent. “...Non-housing retail loans, which are mostly used for consumption purposes, formed 54.9 per cent of total household debt as of March 2025 and 25.7 per cent of disposable income as of March 2024. Moreover, the share of these loans has been growing consistently over the years, and their growth has outpaced that of both housing loans and agriculture and business loans,” the RBI said in its report.Housing loans, by contrast, made up 29 per cent of household debt, and their growth has remained steady. However, disaggregated data sho...
Post a Comment
Read more

External spillovers likely to hit India's financial system: RBI report

By
  While India’s growth remains insulated from global headwinds mainly due to buoyant domestic demand, the domestic financial system could, however, be impacted by external spillovers, the Reserve Bank of India (RBI) said in its half yearly Financial Stability Report published on Monday.Furthermore, the rising global trade disputes and intensifying geopolitical hostilities could negatively impact the domestic growth outlook and reduce the demand for bank credit, which has decelerated sharply. “Moreover, it could also lead to increased risk aversion among investors and further corrections in domestic equity markets, which despite the recent correction, remain at the high end of their historical range,” the report said.It noted that there is some build-up of stress, primarily in financial markets, on account of global spillovers, which is reflected in the marginal rise in the financial system stress indicator, an indicator of the stress level in the financial system, compared to its p...
Post a Comment
Read more

Healthy balance sheets augur well for economy: RBI Governor Sanjay Malhotra

By
  Large tariffs by the United States administration and elevated geopolitical risk have increased near-term global financial stability risks, and along with weather events pose downside risks to domestic growth, Reserve Bank of India(RBI) Governor Sanjay Malhotra said in the foreword to the Financial Stability Report released today.Noting that domestic growth momentum is buoyed by strong domestic drivers, sound macroeconomic fundamentals and prudent policies, Malhotra said: “External spillovers and weather-related events could pose downside risks to growth.”On the other hand, he said the outlook for inflation is benign, and there is greater confidence in the durable alignment of inflation with the Reserve Bank’s target.Commenting that the structural shifts reshaping the global economy are making policy intervention challenging, the Governor emphasised the need for central banks and financial sector regulators to remain vigilant, prudent and agile in safeguarding their economies and...
Post a Comment
Read more