The headline is misleading. You have given only 1 example of a custome who paid Rs. 20 INR (32 cents) in cash. I guess even in US, no one will use electronic mode to pay 32 cents.
On the other hand, you have given so many examples and figures about how the volume of digital/electronic payments in increasing in India. E.g. 'value of transactions using digital wallets rose 64% in last 1 year', 'Transactions made with UPI went from zero to $2.1 billion last month'.
You have also given so many figures of how many million users are active on PayTM and PayTM bank. I wonder why you are still trying to make a case that digital payment options are not doing good in India! The number of growing digital transactions is in itself a proof that more and more people are moving from cash to e-payments.
It's not practical to expect that all 100% transactions will become cashless. I think even the GOI doesn't have that target, that's why the Prime Minister has repeatedly said that he is trying to make India a 'less-cash' economy (not a cashless economy)!
I can't believe only ONE short paragraph half-way through the article mentions that Modi banned cash bills over Rps. 1000 (~$10). Don't you think that will have a HUGE affect on the rate of digital payments?!
This is a major experiment in population control - control their cash/assets, then you can control the people. When Modi effectively banned the use of cash for any sizable transaction, he also restricted that ancient store of treasure Indians love - gold. Why was that omitted from the article.
For the sake of the Indian people and, since you can be sure other governments are watching, the people of the world, I hope the push to go digital in cash doesn't succeed. The greater the push, the greater non-governmental currencies like Bitcoin will flourish.
4
There are many reasons to favor electronic transactions over cash. The reduction in crime and widening the tax base are among them. The biggest reason for favoring a cashless society is that it leads to the kind of efficiency and corporatization that a developed society needs. If you go to any Indian city, you see mom and pop businesses which essentially sell the same goods as the shop next door. The reason for this is that cash leads to lack of trust. You cannot divide profits if you don't know what the profits are. India as a whole does not need 500 independent shops in every city selling granite or 50 independent gynecologists in every city delivering babies. A cashless society leads to consolidation where competition leaves only 3 granite merchants standing who have branches throughout India and all the others become their employees and the gynecologists are all forced into group practices where they share staff and equipment and don't have to work 14 hour days while keeping an eye on the cash drawer all the time. None of this is possible in a cash based society. In western nations, cashless societies emerged organically over a 100 years. Indian government has realized the importance of minimizing the role of cash and has decided to give the push towards a cash less society a helping hand with legislation and executive action.
I have been here in the US for over fifty years.
In the early 70’s when I went on business trips, I took a ‘cash advance’ from the company. On my return, I submitted an expense report. If I was owed money, it came with my next paycheck. If I owed money, I returned what I owed - in cash.
It is certainly less efficient than today’s procedures/processes. I think the old procedure employed more people. I cannot say it was meaningful employment but so is the work of more than half the software jocks here in the valley.
India should develop its own way of addressing these and other problems. Work that is slightly less efficient but with more people contact is preferable. Perhaps it will lead to more empathy.
1
Cash can be held. Why is this such an issue? Waiting for the time I can go to a restaurant and they tell me I can’t use cash. Then I will have The inestimable pleasure of telling them, “then throw it out”
1
I live in India.
I see this cashless revolution every day as reported here, as they say, it's all fake news.
Many here are lucky to see 100 rupees a month.
For them to go cashless, is "let them eat cake."
These politicians' children live in America.
Once a year when either they visit their kids living over there or these spoiled kids come for a 2 week vacation.
They complain to their daddy's how difficult and backward India is compared to America forcing politicians to run these cashless scams.
They tell citizens cashless means India is now America.
To prove, a restaurant in parliament went cashless.
The members wanted to make it a shining example of cashless society wonders that awaits India.
Alas, in a short few months, it went back to cash as no one could really go cashless, but more likely, no machines worked as promised.
From this article alone, Paytm pays to go cashless - and in cash. It seems, it's just another scam.
They tried socialism heavy here for 70 plus years - like other glorious socialist countries led to massive corruption and poverty.
As in other socialist utopias, they have solutions - just looking for problems to solve.
What do they say, "beatings will continue until morale improves."
What India needs is government to get out of people's lives.
Free Indians from these shackles and create an environment where opportunities are for all.
Until they do, cashless yes,- because no one has any money.
8
Wondering how much this matter considering the vast unemployment in India, exacerbated by the Trump immigration changes.
They better not try that here in the U.S. I want to use cash. The electronic services are all about taking your money in fees. Not for me. I am able to save money for my future only because I use cash and never pay a fee.... Plus I am less likely to buy on impulse.... If I don't have the cash, I don't buy it...
4
No cash digital transaction is the future.
However, it does not mean payment via mobile phone only or you would need to use 100s of different payment apps.
1
A few observations here. India like many poor countries has a chronic change problem. I paid a 300 rupee bill in a decent hotel ($7) with a 500 rupee note. The desk guy sent a kid out to scour the streets for change. It took ten minutes. This is normal. Millions of notes are dirty and almost illegible. If there is a small tear, they will not be accepted. My solution is to pay with exact change, and give an amateur Indian neck bobble to any objections. The majority of Indians are very poor, and at any given moment have nothing but a little cash. Until that changes the rest of this will not.
1
simple solution. Don't go India. Let them figure out themselves. If they dont have change maybe they don't need change and are not in a hurry
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As long as corporations are in control and there is the possibility of hacking no one with sense will voluntarily give up their right to physical money. Corporations nickel and dime us daily what do you think is going to happen once they get our accounts all online? More of the same and worse. I can only imagine the thievery is much worse in India where literacy is not as common as it should be.
It already takes too much time and effort to keep accounts straight with the many corps we must engage to deliver our necessary services. Most of them refuse to refund what they steal and only after months of pestering them they offer us "free" things as they try to up sell us in recompense.
1
It should never happen in Indai. This is just inherent in Indian society "anything foreign" is good. This foreign craze has penetrated the financial system. One other main reason for moving towards "cahless society" - corruption. I always argued "Corruption is Good". Then what is corruption. it is the same money for which taxes not paid, after taxes it becomes good. That doesnt make any sense. What can you do with money - corrupt or not. You can only spend it and con only buy HUMAN LABOR. It provides employment to countless non descript jobs like servant maids, rickshawallas, pan wallas, and countless others. Nothing like hard cash the look and feel is the best and trustworthy.
So does Paytm hire any women?
4
I prefer then anonymity of cash as much as possible. Too much of our lives are recorded electronically as it is.
12
The global push for cashless transactions is very worrisome for privacy and personal freedom. Once all transactions are recorded and available for perpetuity the ‘authorities ‘ and their friends know everything about you. They know which newspapers you read, what food you eat and much more. The recent news about ease of penetrating Indian government data in the Aadhaar scheme raises questions about security. The banking laws in a India hold the customer responsible for any breach of his accounts, making them fully liable for all losses arising from identity theft. I think people are smart for resisting the push to abandon cash.
19
I believe there will always be large segments of the world population who want to hold onto their meager cash. They feel safer having it in their pockets. There should always be cash. It's just too easy for banks to cheat the poor, and reasonable for such people to distrust them.
8
MoneyOnMobile has a vast network for digital payments. It's also worth being aware of. The future is happening, now. (finally)
"Growth for the sake of growth is the ideology of a cancer cell."
Edward Abbey
The growth will always end.
The ending will always be the same.
1
Moving from cash to something else has challenged every country. But this is a major problem in India because of deep seated sociocultural problems. In India, the word 'trust' has no real world analog. No one trusts anyone. People claim that there is trust within families. Perhaps some, but not all.
And all this for very good reasons: no one keeps their word. Unless one has to, no one will pay for anything. Everything is stolen by those who can (water, electricity, goods and services). It is not just the mobs that will loot, pillage, burn, and destroy at the slightest cause, the upper classes will withhold payment from vendors and servants . . . whomever, and brag about it.
Working as a purchase manager in a firm is a coveted position; goods and services are accepted, and then no payment is made until bribes are given. Government officials will not do their jobs unless bribed; most even after they are bribed. Banks will not let you withdraw your money without hassle.
It is a country where the only real currency is: how much power do you have to make the other person squirm?
My family has done business with the local grocer for over 100 years; he will shortchange when he can, send us adulterated goods if he could get away with it, and never give a refund for anything purchased - even when it is spoiled, date-expired, or unsatisfactory. India is a land for which caveat emptor was created.
Cashless? Not possible when the country is trust-less.
Kalidan
10
Here is my advice to India---DON'T DO IT. Taking your money away is just another avenue of control. They give you a piece of plastic and then tell you what it is worth and how you can use it. The best use of plastic is to tell them where to put it. Cling to your cash. It is all about CONTROL--not now but soon and forever.
15
Paytm needs to pay its vendors every week or in realtime. One of the frequent complaints I heard from shops is that Paytm pays them only at the endif the month. That doesn't sit well with small vendors who have to pay their suppliers every week.
2
As an expatriate, I only hope that more of my fellow countrymen can carry out transactions digitally instead of using cash. In some sense the anonymity of cash transactions has been the biggest burden to socio-economic growth in India.
4
https://fred.stlouisfed.org/graph/?g=gr5K
January 30, 2017
M1 money supply for India, 2007-2017
(Percent change)
[ India needs faster money creation. ]
2
https://fred.stlouisfed.org/graph/?g=gr5K
January 30, 2017
M1 money supply for India, 2007-2017
(Percent change)
I am all for digital transactions, but just how expressly does that fit in with developing the more beset parts of India? How expressly are the lives of poorer Indians to be bettered?
3
In India, cash transactions are used to hide income. All big ticket items sold like homes and cars have a cash component. Cash also leads to crime since kidnapping, extortion and bribery all have to be paid in cash. Cash pollutes the political system because by using cash politicians can bypass campaign donation limits, money where tax has not been paid can be diverted to politics or gangsters can enter politics with their own cash sources from crime and drugs. Because Indians don't pay income tax, the government is forced to rely on consumption taxes, import duties and various transaction taxes to finance itself. These taxes are all regressive and the poor end up paying a disproportionate share of the taxes. The government is trying to simplify the tax code and push towards digital payments so that it brings transparency and leads to a fairer tax burden with the rich paying their fair share. Only when the tax revenue rises as a % of GDP can the government spend more on health, education and welfare for the poor.
12
I do appreciate this excellent explanation.
3
why is it necessary that you approve of this, or has value in your eyes?
The country has few ATMs. This enables poorer Indians to access money without trips across town. The MoneyOnMobile vast network is also enabling unbanked and under-banked Indians to pay bills, access online shopping and access cash easily at their neighborhood stores. It is remarkable, truly.
1