Wednesday, November 30, 2016

Suggestions for Moving towards Cashless Economy

Suggestions for Moving towards Cashless Economy

According to RBI, 60% of the Rupees 500 and 1000 notes have already been deposited in the banks. So the Government's calculation of blackmoney holders being caught is not going to be fruitful. Realising this, Modi Government has called for people to move into a cashless or e-payment mode. However, there is precious little that the Government has done till date to move more people into the e-payment/e-wallet mode.

So what should the Government do now?

PayTM has already launched massive advertisements featuring the Prime Minister. This is the second company after Reliance Jio to feature the PM in its advertisement. No company can do it without the permission of the Prime Minister. So I am sure the PM has given his blessings. Now the question is why the Prime Minister who always talks about swadeshi is promoting a company where the Chinese hold 40% shares? Unfortunately, that is likely to remain mystery.

Nevertheless, apart from PayTM ie promoting a private company the Prime Minister or his Government hasn't done much.

The pilot for UPI or Unified Payments Interface was launched in April 2016 by the then Governor of RBI Dr. Raghuram Rajan, which powers multiple bank accounts into a single mobile app. Since August 2016 it is available for use. However, not much publicity has been done for popularising UPI. Details about UPI can be found here:

The Modi Government should immediately recruit atleast 1 crore people for atleast one year to move from door to door and popularise UPI app among people. This will also result in sudden spurt in job creation as well as adoption of the UPI app among people. The amount of money required for recruitment as well as conducting this year long promotion can be budgeted.

Politically it will help the Government as the youth will be very happy to get a job as well as act as a change agent.

Bank Accounts for all:
The other important thing that the Government can do is that Government should make it mandatory for people to open a bank account for each child. The moment a child is born, a bank account should be opened and this process should be linked with the birth certificate registration and make it seamless. With Birth certificate and bank account an Aadhar number should be also created. So this will lead to complete documentation of all citizens and any benefits transfer can happen through the bank accounts. This will go a long way towards making our economy cashless and transparent.

Hope someone can whisper these suggestions in Mr. Narendra Modi's ears.

No comments: