GD/PI: Cashless Economy: Is Society ready for Transformation?

Understanding what does Cashless economy mean is more significant here, before we try to understand if we Indians are ready for the same.

So cashless economy is a system where no payments are made using the hard cash or the printed cash but the payments are made through debit/credit cards or through the electronic transfers.

The cashless economy is a dream of the present government where the motto of the project is to use digital technologies to bring the ‘faceless, paperless and cashless India’.

While the above stated motto seems sparingly possible, introduction of right steps have brought significant changes and India now seems to be set to achieve great heights and be an example for the world. However, there are a lot of challenges, which cannot be sidelined.

Why could Cashless economy become more popular going ahead:

  • Cost Reduction: Cashless framework cuts down the expense related with printing, putting away and transporting of money.
  • Risk Reduction: The danger of cash getting stolen or lost is negligible. Regardless of whether the card is stolen or lost it is anything but difficult to obstruct a credit/debit card or a versatile wallet remotely. It is likewise a more secure and simpler spending alternative while voyaging.
  • Ease of use: The simplicity of directing monetary exchanges is likely the greatest help to go advanced. With the coming of computerized modes, one can dodge line for ATMs, execute 24*7 and spare time. Moreover for specialist organizations, with the rise of e-KYC, it is never again important to know your client physically as the installments display has beaten constraints identified with physical nearness.
  • Spending trends: Spending done through versatile or PC applications can be effectively followed a straightforward snap. This enables clients to monitor all their spending and deal with their financial plan successfully.
  • Money Laundering can be stopped: Traders, independent companies, businesspeople, and shoppers routinely use money as a way to abstain from making good on administration regulatory obligation, deals charge, and so forth. Nonetheless, in a cashless economy where all exchanges will be done through sorted out channel, through banks and money related organizations, they can be checked by the administration and appropriate moves could be made against the dodgers. This will result in progressively straightforward exchanges which thusly lead to fall in debasement in the economy of the nation.
  • One economy systems: In a cashless economy it is simpler to follow the dark cash and unlawful exchanges dissimilar to trade based economy out which cash does not come into the financial framework. In the event of computerized exchanges it is anything but difficult to track and screen suspicious exchanges as every one of the records are accessible with the banks.
  • Financial Inclusion and increase in depositeries: At present, India’s low-salary family units get to credit through casual frameworks, through relatives or private banks. Compelling them to move to cashless installment stages in a split second formalizes this universe of familiarity and incorporates them in formal economy.
  • Increase in spend due to discounts: A great deal of web based business sites offer colossal motivations as far as limits, money back, steadfastness focuses to the clients for making computerized exchanges for shopping on the web

Obstacles in making India a cashless economy

1. Over 60% of Indian population has a place with rustic area. Right around a fourth of the country masses doesn’t have cell phones and a huge number of them are PC ignorant. They are not happy, utilizing PCs or cell phones for exchanges and depend on other individuals for help. This occasionally prompts abuse of the records and directing of assets, so great share of country mass incline toward money over computerized modes.

2. About 90% of the Indian work advertises is casual. Dominant part being utilized in horticulture and assembling division where day by day wage is predominant. Under such conditions the casual work advertise is intensely cash dependent.

3. India is where 90% of exchanges are paid for in cash. Since money encourages making exchanges mysterious, disguising exercises from the legislature in a manner that may enable operators to maintain a strategic distance from laws, guidelines and charges.

4. Security is another enormous concern with respect to cashless exchanges. The Indian Computer Emergency Response Team (CERT-In) has revealed a flood in the quantity of episodes till October 2016 with near 39,730 security occurrences. Indians are careful about computerized modes due to digital security occurrences, for example, phishing, checking, site interruptions, mutilations and infection code.

5. In spite of the fact that few organizations have concocted reasonable advanced cells still they are not moderate for the greater part of the general population in the nation. Except if Indian government gives fundamental endowment or moderate arrangements cashless economy would be an outlandish dream.

6. Advanced India experiences the danger of burglaries and hacking of computerized cash instruments. The ATM cards, Debit/Credit cards, Net Banking arrangements and even the exchange sites of the budgetary organizations and banks are hacked by the devilish individuals who pull back cash by making clones and changing the passwords. This must be dealt with before continuing on advanced India mission..


Truly, India is prepared for a cashless economy.

As indicated by TRAI, as on 30 September 2016, 82 out of 100 residents in India possessed a cell phone. The development of the telecom biological system, with huge decrease in call and information rates, alongside the lower costs of advanced mobile phones, is driving the move to a cashless economy.

The legislature of India is working dedicatedly to push India towards a cashless economy. With significant activities, for example, demonetization, Direct Benefit Transfers, BHIM and some more. The goal is to streamline the economy and control defilement.

The administration endorsed for a proposition, under which there would be no charge for BHIM, UPI, and check card exchanges up to ₹2000.

Government additionally ran a DigiDhan crusade where 16 lakh fortunate victors (clients and shippers) were compensated with prizes extending from Rs 1000 to 1 crore.

Further to boost conduct change and cut down the expense of advanced installments, referral and money back plans have likewise been propelled for BHIM where clients and dealers get money back. Additionally, activities like USSD and the *99# administration have guaranteed that non-Smartphone clients are likewise ready the cashless wave.

Demonetization has given a force to e-wallet administrations. As indicated by a report “Verifying the cashless economy”, by Pwc, India saw

3X increment in the download of a main portable wallet application inside 2 days of the demonetization declaration.

1 million: Number of recently spared credit and check cards inside two days of demonetization declaration.

100%: Day-on-day development in client enrolment with driving versatile wallets after demonetization.

30%: Increase in application utilization and half increment in the download of wallets sponsored by driving banks.

The previously mentioned information unmistakably speak to a move towards a cashless economy.

The advanced mobile phone upheaval has prompted the development of web based business, m-trade and different administrations, including application based taxi aggregators, who empower computerized installments for utilization of different administrations. The esteem included administrations, for example, money back, charge installment offices, steadfastness focuses, rewards and usability have brought about flood of such advanced stages. These improvements have offered ascend to an advanced installment display.