India is ready for cashless economy but some Indians are not.
Earlier in 2016, when the Prime Minister Narendra Modi announced demonetisation, the government supported its decision by calling it an exercise to curb black money. To some extent, it worked well in that direction. We saw news reports of people burning their black money, while some threw their Rs 500 and 1000 notes on roads.
Due to lacklustre curb to black money, the government kept changing its narrative around demonetisation. It later said that government’s move will address the issue of terrorism funding.
When this did not bode as planned, the government said that demonetisation was aimed at taking the Indian economy towards cashless economy.
But the billion dollar question is are we ready for it?
We are still not clear about government’s intent behind demonetisation but India did a commendable job and has took a big leap towards cashless economy ever since demonetisation has been announced. Considering India’s gigantic demography, we would need a robust infrastructure and a lot of education for bringing our rural under the ambit of cashless economy. In addition to that, the government need to take rigid steps to avail secure cashless transitions to build trust among masses.
The government should make sure that if India has to go cashless it should be safe. Cyber-crime in India is growing at an alarming rate. This has to be eliminated or at least reduced so that people believe and start transitioning towards a cashless economy.
If India manages to do so, we will be the first country in the world to become a cashless society.
What are roadblocks?
Infrastructure: A large chunk in India is still not has access to mobile phones. We need to make sure that each of us, atleast whosoever is involved in online transaction has a mobile phone.
Network: It is no secret that India has worst cellular networks around the globe. Can you imagine a dream of going cashless without a good network?
Secure Payment gateways: India is a country where we have more hackers than good developers. Every now and then we hear a news report of phishing, hacking and financial fraud. Please also consider that over 50% instances are not reported as people themselves are not aware that they are being attacked.
PoS Machines: According to a 2015 Ernst and Young report, there were only 693 machines per million of India’s population, compared to similar emerging countries such as Brazil, which has 32,995 terminals per million people and China and Russia, each of which has around 4000 terminals per million people.
Corruption: Since all digital transactions can be monitored or traced easily. The income tax sleuth can easily nab people involved in doubtful transactions. In such a scenario, people who are involved in rampant black money transactions would never let India become a complete cashless economy.
Unfortunately, people who are involved in country’s decision making would not wish India to turn a cashless economy. India is ready for cashless economy but some Indians are not.