India’s cash conundrum: how ready is India to go cashless?
Mumbai: When the Indian government invalidated high-value banknotes on the night of 8 November, taking out 86% of the currency in circulation by value, it was supposed to be a war on unaccounted-for and untaxed wealth, counterfeit notes and terror financing.
Somewhere along the way, as serpentine queues formed outside bank branches and automated teller machines (ATMs) for days and weeks together, the slogan changed. It became all about promoting a cashless or at least a less-cash culture in an economy where almost 90% of transactions are paid for in cash.
The talk turned to technologies such as mobile wallets, crypto-currencies such as Bitcoin, mobile peer-to-peer payments, block chain technology, payment banks and architectures such as the unified payment interface (UPI) and the recently-launched Bharat Interface for Money (BHIM) app.
The total value of all transactions done using electronic payment systems in India in December rose to Rs105 trillion from Rs95 trillion in November, according to representative data released by the Reserve Bank of India (RBI) on 17 January.
They included transactions done through the real time gross settlement (RTGS) system, the national electronic funds transfer (NEFT) system, immediate payment service (IMPS), credit cards, debit cards, UPI, point of sale (PoS) terminals and mobile banking.