Can India move towards Cashless Economy? Part 1
Can India move towards a Cashless Economy?
What is a cashless economy?
Financial interactions between transacting parties involve the transfer of digital money.
For cashless transactions, cashless payment methods such as credit cards, debit cards, electronic payments via digital devices, and so on are employed.
Present Scenario
In India-
- Despite the fact that cashless payments are becoming more popular in India, cash remains the most common means of payment.
- People were initially hesitant to use cashless transactions owing to a lack of understanding, security concerns, and the restricted availability of the internet and mobile phones, particularly in rural regions.
- Internet and mobile phones have penetrated every family since the technological transformation over the previous 4-5 years.
Worldwide-
- The use of cashless payment options is growing all across the world.
- Sweden is on track to achieve a cashless society by March 2023.
Facts and Figures
- Between Aug’16 and Aug’18, the UPI interface processed 93,000 transactions.
- According to PMGDISHA, India has just 41% internet penetration.
- 57% of India’s overall population still prefers cash transactions.
Conclusion
- Although the cashless economy appears to be highly promising, we must address issues such as banking the unbanked, banking illiteracy, and digital illiteracy in order to go cashless.
- We need easier ways to educate people about the significance of cyber security and protect them from online scams.
- Central bank digital currency has the potential to transform the financial system.
- The introduction of a central bank’s digital currency can aid in the fight against financial crime.
- India is undoubtedly on its way to becoming cashless, but the cashless economy will have to wait for a while.
- With a number of efforts, the goal is to simplify the economy and reduce corruption.
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