Is India ready for cashless economy?

1

• Is India ready for a cashless economy?
• Being resistant to change is fundamental to human
  nature, but one needs to embrace newer things in
  order to evolve. That's how our society has
  evolved over the millenniums.
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• After the announcement of demonetization on the
  9th of November, 2016, India realized the
  importance of a cashless economy. So for people,
  who were well apprised of Mobile banking,
  Internet banking, etc., maneuvering through the
  difficulties became a little less cumbersome.
• A cashless economy is a system wherein the cash
  flow is negligible, and the financial
  transaction is done via electronic medium.
• Benefits of a cashless economy
• Tax evasion will be difficult- According to a
  survey, only 4 of India's earning population
  pays tax. By just 4, we are the sixth-largest
  economy imagine where our economy would be if
  this number went up to 80.
• Ease in doing a financial transaction
• Lower risk - If one does not carry cash, getting
  mugged reduces significantly. This is a
  significant problem in the rural parts of the
  country.
• Reduced cost of printing, and circulating
  currency- From 2016 to 2018, RBI spent 11
  thousand crores in printing new notes. 23.6 of
  India's population lives below the poverty line.
  This money could easily have been used for their
  upliftment.
• Fake currency - In a cashless economy, the
  question of fake currency goes down the drain.
• It also helps mitigate the root causes of
  corruption like money laundering, criminal
  activity, and Hawala transaction and gives the
  Government more control over drugs and human
  trafficking.
• Now, coming to the big question. How do we
  achieve it? Is our country literate enough to
  handle this kind of technology? What about rural
  India?

2
For starters, I would like to point out that you
don't have to be tech-savvy to perform basic
transactions in applications like BHIM, Paytm,
etc. In fact, with the advent of Jio, people,
especially in rural areas, have started using
Facebook, Whatsapp, Youtube, etc., more than
before. So if they can learn Facebook, Twitter
they can very easily learn to operate banking
applications. My suggestion is to start slowly
with one village in a district. Making people
aware of the technology, encouraging them to use
it by giving incentives or discounts and if it is
a success then implement it in the surrounding
areas. If there are any repercussions, then make
amendments. If the Government does not have
enough resources, then it can employ NGOs for
this. Laura in Budgam district has become the
first village in Jammu and Kashmir to go
cashless. CSC e-Governance Services India
Limited started by training one person from a
family about the electronic payment system
(EPS). Some villages in Goa have also become
cashless. Some people contend that India is not
literate enough the literacy rate of India is
74.04. Right now, 97 of our children are going
to school. It means that in the coming years, the
literacy rate is poised to increase. By the end
of 2019, there will be 813.2 million mobile phone
users in India. Hence the technology has spread
enough. Now it's just about awareness. The
encryption used by the Indian Government is
128-bit. It is one of the most secure encryption
methods used in most modern encryption algorithms
and technologies. 128-bit encryption is
considered to be logically unbreakable. The
Government has also taken several initiatives to
encourage people toward digitalization of the
banking system viz. In August 2015, RBI gave a
payment banking license to 11 entities. Pradhan
Mantri Jan Dhan Yojna is ensuring that every
citizen, if eligible, must have a bank account.
It has launched Rupay, Adhar enabled payment
system, which does not require an internet
connection. There is a discount of 10 on the
fare in the Delhi metro on the usage of the
metro card. 5 discount on digital payment for
the railway, catering, accommodation, retiring
room, etc. 10 discount on National highway toll
payments via RFID or first-tags.
3
It goes without saying that the above is not
enough, but we are continuously making progress,
and in a few years, we will be there. However,
our infrastructure needs to improve. There are
only 2.3 lakh ATMs. Accessibility to an ATM in
the metro cities is good, but in tier 2 cities
and rural areas, it is rather challenging to
find an ATM. There are loopholes, and they will
always be there unless we work upon them we need
to take the initiative. Procrastination is never
the solution.