Demonetization, the concept which forced Indians to move towards a cashless economy. Modi’s move frustrated a few Indians & made few Indians happy. Few world leaders appreciated the bold move while others criticized. A handful of people think it will help the Indian economy while others do not believe so.

I am not here to talk about what demonetization is about or whether the move taken by Modi is good or bad nor am I here to talk about anything that has happened recently in India. I am here to talk about “Moving towards a cashless society”. Mark my words as I am using the term “society” and not “economy” because being a computer science graduate I don’t understand the term “economy” much. I would have spoken about cashless society before demonetization move, but people would have not understood it as they had cash in their hands. After demonetization, people started searching for alternate ways to survive in the society and this is where I come into picture as I have been cashless since past three years. I really want people to move towards a cashless society, not because I am using but because the advantages exceed the disadvantages. We all know nothing is perfect and there are always some flaws. We choose what suits us because the advantages of choosing them are greater than the disadvantages. I would give an analogy of buying a smart phone; there are more than thousands of smartphones in the market which gives us a lot of options but we choose only one smart phone. Our decision before buying a smart phone is based on a lot of factors like budget, look & feel, purpose of use etc. Similarly moving towards a cashless society have just handful of cons but bag full of pros.

Advantages:

  1. Reserve Bank of India(RBI) & other banks spend approx. Rs.20,000 crore annually on making, handling, counting & transportation of cash. We can help save a little money by learning how to go cashless.
  2. There are three scenarios:
    • If six friends go on a dinner & one person pays total amount which when divided comes to Rs. 120 per head. The number of people not having change is high and what happens is all five forget to pay Rs.20 as they are friends but the person who paid total amount tends to pay Rs.100 more. If we start using e-wallets, debit/credit cards, internet banking etc. this scenario can be avoided.
    • Have you seen the movie “Tum milo toh sahi” starring Nana Patekar, Dimple Kapadia, Suniel Shetty. Even if you have not seen the movie, you might have seen the clip which went viral . In this clip, the shopkeeper does not have change and so she gives Nana Patekar chocolates which makes Nana Patekar furious. We all have got chocolates instead of change. This is an excellent way to increase the shop’s sale. You can pay the exact change by using e-wallets, debit/credit cards, net-banking etc.
    • When we go to shop or dine-out sometimes the bill comes to Rs. 99.50 to which we give Rs.100 and forget the remaining 0.50 paise. In this way if 100 customers let go of 0.50 paise. the shop earns Rs.50 by doing nothing. This can be avoided by using e-wallets, debit/credit cards, internet banking etc.
  3. Discounts, offers, cash back. We are always looking for discounts on online stores like amazon, flipkart, snapdeal or in the normal shops like pantaloons, lifestyle or any XYZ showroom. Sales increase by almost 15.4% during holiday or festive season (read when discounts are offered by the store).  Most of my payments, purchasing, transactions are done online.
    You can have a look at a few:Received GoCash after doing a booking on Goibibo:
    screenshot_2016-12-27-12-09-01.pngAfter booking two hotels through MakeMyTrip(MMT), they gave cashback:screenshot_2016-12-27-12-06-34.pngTo recharge or pay bill we all waste time in going to the store, waiting for our turn to come, the commute time. Instead of doing this we can download our carrier app and recharge or pay bill whenever we want, like while travelling, during any time of day or night etc. To add to an advantage, they (Airtel in this example) provide a cashback as you can see below:screenshot_2016-12-27-12-05-31.pngSimilar to Airtel, other e-wallets like Freecharge also provide cashback when you recharge through their app:screenshot_2016-12-27-12-04-49.pngI used my Bank of Baroda (BoB) debit card while doing a booking online. As you can see below snap, I have got 25 points for using the debit card in addition to cashback received on other platforms:screenshot_2016-12-27-12-04-27.pngI went out with my colleagues to eat and we didn’t have cash so we paid the bill through Paytm wallet and got cashback of Rs.2 just for not using cash:Paytm_Cashback.png
  4. We want the government to be transparent, we want to know where and how our money is being used . We want to know which roads, public toilets, railway stations, trains etc our government has built with the tax we have paid. In return, the government also wants to know where we are using our money. The government wants to know if we are spending our money in a proper/legal manner and just wants to keep a track on our income and expense. If we become a cashless society, everything will be stored digitally and showing the government our money, our expenses will become an easy task for us and also the government will not have to waste time in verifying our money because machines don’t make mistakes by themselves, as it is said, “We cannot clap with one hand”.
  5. Consider you are carrying a wallet with Rs.5000 and you lost your wallet or someone stole it. The money is gone. Unlike cash if you lose your credit/debit card, you can block it just by calling the bank and giving the required details or else if you have your smart phone and mobile banking is enabled, you can block your card using your smart phone. If you lose your smart phone, you just lose your phone and not the money in the e-wallets. (Considering your smart phone is locked smartly. Refer my blog on “How to use your smartphones smartly”.)
  6. Expanding the above point, I want to tell you the advantage of buying a credit card. If your credit card is stolen and the thief knows your password using which he purchases a lot many things. You can recover some/all the money from the credit card if credit card company identifies the transaction as a theft.
  7. If there is no cash in the society; robbery, burglary, extortion etc will decrease.
  8. We might have different opinions about demonetization, cashless society but we all share same hatred towards terrorism and want it to end. If every individual’s money is traced by the government and for a suspicious transaction done by an individual, the person can be put behind bars. By this,the funding for terrorist attacks will also reduce.
  9. Passwords are difficult to remember especially strong passwords and to reduce this headache, systems have started with the concept of OTP (One-time password). An OTP is generated and sent to your registered mobile number  and is valid only for 30 seconds and after that it expires and you need to ask for a new OTP.
  10. Advantages introduced by government for moving to a cashless society:
    • 0.75% discount on purchase of petrol/diesel through digital means.
    • Discount upto 0.5% for monthly or seasonal railway tickets from January 1 2017, if payment is made digitally.
    • All railway passengers buying online tickets shall be given free accidental insurance cover of upto Rs.10 lakh.
    • Using RFID card/Fast tags for the payment of toll at toll plazas on National highways , a discount of 10% will be available to users in the year 2016-17.

Disadvantages:

  1. Everything will be stored digitally, hence chances of your account getting hacked will increase. We will become more prone to hackers. (can be avoided if we use proper locks similar to keeping cash safe from burglars)
  2. I know it is difficult to trust third-party with our hard-earned money. (if you are worried about losing your money to third-party, along with you there is a population of more than one billion)
  3. We lost a lot of jobs when machines started doing the monotonous work, though employment increased in the fields of machinery. Similarly, unemployment may come when we move towards a cashless society but I am sure employment will increase in some other field definitely.
  4. We can never become a cashless society unless the society is educated. Rural India will take a lot of time to become cashless as we need to educate them, we need the infrastructure so that the digital transactions happen smoothly and people can develop trust on smartphones, e-wallets, internet banking etc.
  5. A few websites force us on keeping a strong password with the following requirements:
    • Minimum 8 characters
    • An upper-case letter
    • At least one numeric
    • At least one special character

    They also keep a note such as ‘your password should not be your name, date of birth, family member’s name, family member’s date of birth, mobile number’. This makes it hard for us to remember the password. E.g. @twfg56% is a difficult password to remember but impossible to crack as there is no relation between an individual and password.

  6. If your card and phone is stolen by one particular person, OTPs stand as a disadvantage which is why we need passwords and OTP combined.

Many people are still worried about the security of smartphones, digital wallets, internet banking, online transactions etc. I have only one thing to say – Your vault is locked which is inside a locked cupboard which is in your locked house to which only you and your family members have access. Similarly, your smart phone should also be locked. You can get more details on securing your smartphone from my blog on “How to use your smartphones smartly”.

Conclusion – It is clearly understood that advantages outweigh disadvantages and moving to a cashless society will be more helpful to us rather than the society. I am not asking for one to go cashless completely, my motto is that as a society we should start moving towards a cashless system. No one will learn how to go cashless completely in the first attempt but we need to take baby steps and keep moving forward. A good analogy would be that school does not teach us tens, hundreds, thousands, lakhs or crores. We first understand what numbers are and when we understand 0-9, we move forward. Due to demonetization people have known about cashless society and it is better to get a grip of the concept when it is in the early stage rather than waiting for some government to get rid of cash after few years and then start learning.

I gave a speech on “Moving towards a cashless society” in Sarvoday Nagar, Mumbai for BJP on 05/01/2017 and extending my support for #DigitalIndia and #CashlessTransactions.

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Makar Sankranti 2017: I prepared a kite to spread awareness on “A Cashless Society” by making the smallest kite and using scraps. For the idea and presentation, I received a special award in my office.

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If you need any help you can contact me:
Compusoftplus,
Ground floor, Thanawala bldg, Barrister Thanawala Chowk, 2nd Fanaswadi, Kalbadevi, Mumbai – 400002
+91-9699188146 / +91-9322253695

 

 

Thank you note: I would like to thank my brother-in-law Siddharth Ashara for helping me gain confidence in Cashless transactions. Also, Garima Thakur for suggesting me edits for the above article.

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2 thoughts on “A Cashless Society

  1. This made a very interesting read. Very well explained. I too am always worried about hackers and all my personal details being stolen. Great job.

    Like

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