Transmogrification of ‘demonetisation story’ to ‘cashless story’
Mahadeep Singh Jamwal
Rural population is left in worse off conditions. We should not get carried away by the visions of a cashless society and proceed with caution. Now, this will mean that people will have to make e-payments in matters of property tax, professional tax, utilities like water, power and gas, fee and licensing charges, online booking of community halls for functions, issuing or renewal of birth and death certificates, registration of shops, library membership and all. Mobile ATMs and micro ATMs have been a rare sight. Over 90 per cent of all transactions in India were conducted in currency.
In new system of cashless society, every transacting individual require a ‘Smart Phone’ which cost not less than at least ten thousand rupees, our poor people earning hardly to survive cannot afford it. The government should subsidise these ‘Smart Phone’ for those without. The middle and upper class people have the resources to be able to buy mobile, download the necessary apps, and open bank accounts, but I would worry about how the poorer parts of Indian society will be able to deal with this transition. How do they get mobile phones and Internet access? Every individual has to wear the cost of Internet connections. Improvements in the telecom infrastructure, access to Internet connectivity and low-cost smart phones is the first priority to eliminate the cash based economy. The availability of electricity to last corner of the country and free Wi-Fi connectivity is the prime requirement in all villages, where transactions as low as Rs. 10 take place on phone through SMS and the Internet. The factors such as; recently launched Unified Payments Interface (UPI) by the Reserve Bank of India (RBI), which uses Aadhar identification and one’s mobile number to make payments, is set to revolutionise payments systems in India, but almost 600 million people are unbanked, unable to change into cheque-writing or debit or credit card use, about 30 per cent of the population lack even the basic ID required to change over the cashless system of e-banking, under these circumstances how the changeover would be acceptable to this section of society. Although many players are waiting to take off into these seamless and modern payments such as; new credit/debit cards, e-wallets and other mobile based payments such as Airtel Money but interestingly at the same time, it is also propagated that this “war on cash” is not driven purely by consumers desire to mitigate the inconvenience of carrying notes and coins, instead the war has highly powerful proponents backing it, and this is closely tied to the perceived advantages of a cashless society. The most powerful drivers of the change are, unsurprisingly, those from the payments industry, such as credit card companies and banks. At the face of it is difficult to rule out this assumption. The PayTm’s congratulatory messages to PM for a change to ‘cashless society’ speak much about it. PayTm’s traffic, for instance, increased by 435 per cent and downloads by 200 per cent just in a week’s time. The class offering online wallets and digital payments is a clear winner in it. It is forced change of the government being burdened on poor people by a very ticklish move to limit the withdrawals from bank accounts.
Concluding it is not out of box to say that the prime cause for demonetisation has almost not figured much as black money is back in circulation, militancy activities have not curbed; counterfeiting has appeared, no relief in price escalation, no cut in interest rates, so the total expenditure coming out to be around Rs 20,000 crore in order to print new notes but the total expenditure coming in the entire demonetisation process in 50 days is going to be huge and according to one estimate, it is around one lakh twenty thousand crore rupees. Why this huge sum wasted? It appears that some players of this move want to become hero overnight by thrashing the common man on road and like demonetisation, the cashless vision although beneficial but being thrusted without planning and preparations.