Can the Indian go Cashless

Can the Indian go Cashless

Achievers GDPI Workshop: Concept Builder

Topic: Can the Indian Economy go Cashless

Barriers to digital payment options

Acceptance Infrastructure
Point-of-Sale (POS) terminals penetration in India is amongst the lowest in the world. While that is a collective
grievance being addressed by ecosystem players and the RBI has planned a fund (Acceptance Development
Fund) to improve numbers and make a cashless India in it’s a long term play.

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Internet Availability
While India is the second biggest smartphone market in the world yet mobile internet usage is low hence
digital only payment solutions do not find a firm footing in the ecosystem despite consumer/merchant

Consumer Behavior
Consumers have known no other way to pay other than cash which is now. It’s trusted and is learned
behavior. The learning curve with digital methods is steep especially with low literacy levels and internet
access being a privilege which deters a switch over and develop to make the dream of cashless India come true.

Government Backing and Policy Support
Immediate surcharge removal on all forms of payments by plastic on all government institutions including
airports, insurance providers, hospitals, restaurants, ticketing should be the first priority for the government
to incentivize use of non-cash methods

Financial Literacy
Lack of Knowledge about basics in how to use banking services, debit cards, security of PIN/Card, linking
mobile number with a bank account and how to use a card instead of cash, use of wallets on smartphones for

Enablers for the transformation

  • Good digital development ecosystem to develop smart technologies to facilitate this transformation in the future
  • Competitive Landscape in telecom and banking industry to push the spread of cheap internet
    connectivity to rural and remote areas and inclusion of more people in the financial systems
  • Government Iniaitives – Jan Dhan Yojana, Issuance of Payment Bank licenses, Launch of BHIM app, Direct Benefit transfer scheme, Adhaar Enrolment

Other Developing Country Examples
– Brazil – Banks in Brazil took deposit and withdrawal transactions into retail shops that exist in every
village and neighborhood.

Kenya – In Kenya, the mobile-phone operator Safaricom has developed a network of 30,000 stores through
which its customers can cash in and out of their M-PESA mobile wallet accounts. That’s 200 times the number
of branches operated by the largest bank in the country. 17 million Kenyans — about three-quarters of the
adult population — can send or receive money via cell phone


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