International Journal of Current Trends in Science and Technology. Challenges and Opportunities experienced in moving from Cash to Cashless Economy

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1 International Journal of Current Trends in Science and Technology Online ISSN: Print ISSN: Challenges and Opportunities experienced in moving from Cash to Cashless Economy Waseem Akram Assistant Professor of Computer Applications Government Degree College Mendhar Accepted ; Published Abstract: Advanced India is a development propelled by the Government of India to guarantee that Government administrations are made accessible to nationals by electronic means by improved online framework and by expanding Internet availability or by making the nation carefully enabled in the field of innovation. Demonetization is the act of stripping a currency unit of its status as legal tender. It emerges at whatever point there is some sort of progress in national money: The current form of money is pulled from circulation and retired, often to be replaced with new notes or coins. A cashless society is a term portraying the monetary eco-framework in which physical cash, to be specific paper banknotes and metal coins, are supplanted with virtual, advanced cash, and where money dissemination is substituted with installments done by utilizing a few sorts of cards, versatile gadgets and different other gear associated with the web. A cashless economy is one where cash flow is minimal and all the electronic channels like debit card, credit card, electronic merchants, payments such as IMPS are mode of transaction. Banks have stepped on to the mobile banking and electronic banking as well. At the same time, non-banking companies like Airtel, Vodafone, Paytm, Mobiwik are offering wallet services already. To make this transition possible, the government will need to work on digital infrastructure. It also has to waive the service tax on digital payments. India has one of the highest cash to GDP ratios in the word, and lubricating economic activity with paper has costs. Banking and financial Institution provides point of sale (POS) technology that allows transactions with the absence of cash at the time of purchase. It is used in canteens, shopping malls, restaurants and particularly in schools and colleges. This involves the availability and affordability of financial services and products and whether people use bank accounts and electronic payment products. The government on its part is functioning at various levels to reduce the requirement on cash. Opening bank accounts for the unbanked customers under the PMJDY Scheme and adoption of direct benefit transfer is part of the overall idea to reduce usage of cash and increase transparency. Keywords: Demonetization, cashless economy, GDP, Point of Sale, Digital Payments, PMJDY. Introduction: A cashless society is a term portraying the financial eco-framework in which obvious, physical cash, to be specific paper banknotes and metal coins, are supplanted with virtual, computerized cash, and where money flow is substituted with installments done by utilizing various sorts of cards, cell phones and different other hardware associated with the web. The advantages of a cashless society to the executing open are significantly more than just accommodation and security related with the installment framework. Current tight liquidity conditions and the requirement for budgetary Page 20239

2 straightforwardness and incorporation can be tackled through the reception of plastic cash. This likewise can possibly add to total national output (GDP) development as most of the people is brought into the saving money framework. Electronic installments have made considerable advances among buyers in some created nations. The main preferred standpoint of building a cashless economy is disposal of dark cash. Digitalization of exchanges is the most ideal approach to move towards cashless economy. Such a cashless economy is feasible by advancing electronic cash instruments, creating money related framework and spreading computerized exchange propensities among individuals. Conveying extensive measure of money includes chance factor probability of robbery increments when somebody conveys colossal sum. In cashless economy since there will be no money to convey so there will be no plausibility of robbery. Without money everyone will be executing through electronic channels like check card, charge card or net managing an account, and so forth along these lines pay assess dept. can keep watch over each exchanges. It will prompt increment in impose consistence. Everybody will begin paying assessment to the govt. so eventually it will expand the incomes of the govt which can be utilized for the welfare of the nation. Prevention of corruption for example: if any public officer is demanding for a bribe then he/she will have to receive it through his bank account. Every detail of bank accounts will be checked by income tax dept. so therefore he/she cannot take bribe through bank so it will lead to prevention of corruption. A cashless India will not only to curb unaccounted wealth, but also to reduce instances of tax avoidance. Direct wiring of money to the user will give greater efficiency and transparency to the system. It will also tackle, to some extent, the fear of counterfeit currency. Small SMEs and digital India will evolve with an improvement in credit access and financial inclusion. Demonetization has been a shocker for the Indian economy whether it succeeds in helping the transition to a cashless economy. Objectives: To study type of cashless modes and payments. To reduce the corruption which takes place To reduce the burden of the cost of printing currency and also handling them. To study challenges for India in going cashless. To study opportunities ahead for cashless economy. The transfer of money from one place to another is also dreadful. To track the movement of money which is not possible completely in cash medium To revive the banking sector which is high on NPA and bad loans To make loans cheaper and affordable for everyone. In short, cashless is better in all aspects. But there are certain challenges for India to go completely this way. Otherwise, it's good for a growing economy like India. Why India cannot go for cashless economy immediately? Lack of access to banking: Most of the people in India are not connected with the banks. Therefore Govt. of India has come up with Pradhan Mantri JanDhan Yojana (PMJDY) scheme which aims to connect all Indians with banks. Unless high number of people starts using banks for transactions, it is difficult to make India a cashless economy. Electricity: Electricity is another issue which may create hurdles for smooth implementations of cashless economy. In current days, whole India is unable to have access to the electricity. Still most of the villages in India face load shading whereas 24X7 availability of electricity is necessary for the smooth functioning of cashless economy. Internet: Internet is required for online transactions. Penetration of internet in India is yet to be done. Merely 35% population of India is connected with Internet. Rest of 65% people is far away from Internet connectivity. Illiteracy: One of the biggest problems which India is facing is illiteracy. Around 30% population is yet to be educated. These are the people who don t know how to read or write and they don t know how to use computer and internet. So they are far away from Internet Banking. mostly through the cash medium Page 20240

3 Extra Charges on Online Transactions: Another reason for de-motivation for online transactions is extra charges levied on such transactions. Due to such extra spending people prefer to deal in cash. Extra charges are needed to be taken away so that people may refer to online Banking. Lacking infrastructure: Retailers and consumers choose to deal in cash because swipe machines are not available on large scale. ATMs are available but those are not sufficient, most of the nationalized banks lacking behind in providing service. Customer has to wait in queue for long time for depositing cash in banks. After reading almost number of articles regarding demonetization, some positive and most of them negative, many questions have come in my mind. Like 1) Why do people avoid taxes even after earning so much money and how to reduce this tax evasion? 2) Why do we have to carry a note in our pocket when we have a card, smart-phones these days with us? 3) Why still many companies into old way of doing business transaction with cash in the entire supply chain pipeline when they have to bear a risk of carrying cash with them in pipeline? 4) What is that which can actually bring job to this country in rural sector apart from giving the same old pot digging work under MNERGA? "Problems are Opportunities when we know a problem actually exists in tax payment in this country and there is a problem of black money generation, there is an opportunity also.this opportunity is: Cashless Economy. Types of Cashless Payment Methods: 1. Cheque: The cheque is one of the most established techniques for cashless installment. It is a known technique to everybody. In this strategy, you issue a cheque for the particular add up to another person. The cheque gets saved in the particular bank. The bank forms an installment through a clearing house. The whole exchange done through Cheque gets recorded and there is a proof of installment. Nonetheless, there are cases where Cheque installments get shamed because of mark bungle or lacking asset. With a specific end goal to stay away from such issue, you can utilize different cashless installment alternatives. 2. Request Draft: Request draft is another simple method for cashless exchange. It is a most secure alternative to get installment from anybody. Request draft (DD) never gets defaulted as it is marked by the investor. The hindrance of DD and check is you have to visit a bank keeping in mind the end goal to store check and request draft. The freedom of check or DD takes extra time. 3. Online Transfer-NEFT or RTGS: The third least complex strategy for the cashless exchange is online exchange utilizing NEFT or RTGS. Keeping in mind the end goal to do online cash exchange, you require web saving money office. Online exchange utilizing NEFT or RTGS is relatively speedier than check or DD. Online exchange should be possible from anyplace utilizing web office. 4. Credit Card or Debit Card: Credit card or platinum card is another cashless installment strategy. The utilization of credit/charge card and check card was constrained in India. Be that as it may, use of charge card and check card is expanding now. The constraint of this installment strategy is an accessibility of swipe card office (PoS) at trader end. 5. E-Wallets: E-wallet is next cashless installment alternative. E-wallet can be utilized to buy items beginning from basic need to carrier tickets. Keeping in mind the end goal to utilize E-wallets client and shipper, both require a cell phone with dynamic web association. The most well-known case of E- wallet is PayPal. In the wake of enlisting for E-wallet you have to connect your Visa or plastic card with your E- wallet id. You can utilize e-wallet for subsidize exchange or web based shopping. It is a least difficult cashless technique. 6. Versatile Wallets: The following cashless installment technique is a portable wallet. You needn't bother with a charge card, Visa or web saving money secret key for making installment utilizing a versatile wallet. Page 20241

4 Simply stack cash in your wallet by means of IMPS and utilize it moving. You can download versatile wallet application from play store. Scarcely any cases of versatile wallets are Paytm, Pay U money, Oxigen, Lime, Mobi Kwik and so forth. 7. UPI Apps: UPI is a versatile installment framework which enables you to do different money related exchanges on your cell phone. UPI enables you to send or get cash utilizing virtual installment address without entering bank data. Traders can select with banks to acknowledge installments utilizing UPI. Like on account of a PoS machine, the trader would require a present record with a bank to acknowledge UPI installments. The cases of few UPI Apps are SBI Pay, ICICI Pocket, Axis Pay UPI App, Union Bank UPI App, PNB UPI, PhonePe, TranZapp and so on. 8. Gift voucher: The following cashless installment technique is a gift voucher. Gift voucher is a readymade card and can be obtained from a vendor or from the bank. The gift voucher is stacked with a fix money sum you can buy anything from the particular seller by utilizing a gift voucher. 9. Aadhaar Enabled Payment System: Aadhaar Enabled Payment System (AEPS) is extraordinary compared to other cashless installment strategies. AEPS resembles Micro ATM it utilizes cell phone and a unique mark scanner for the exchange. Keeping in mind the end goal to utilize this office, it is obligatory to connect your Aadhaar card to your financial balance. You can utilize AEPS keeping in mind the end goal to perform exchange like Aadhar to Aadhar finance exchange, Cash withdrawal, Cash store and so on. 10. Unstructured Supplementary Service Data: You can utilize USSD cashless alternative in the event that you don't have a cell phone or web association. Unstructured Supplementary Service Data is portable managing an account benefit. From any cell phone, you can dial *99# and utilize this administration. You can do every one of these things which are accessible to a man with cell phone and web association. All banks including SBI, ICICI, BOB, Axis Bank and PNB underpin USSD installment choice. Future Prospects: As more individuals begin utilizing Rupay Debit cards and aadhar for computerized installments, it will encourage a less money economy. With expanding versatile saving money administrations, development in internet business and utilization of portable installment applications, utilization of money will diminish. The JAM foundation is spreading to achieve every remote corner of the nation and additionally to each native. Practically numerous PMJDY accounts, Aadhar personality cards and a huge number of portable and web clients are in India. This implies JAM framework can be utilized to advance the cashless exchanges. A substantial number of government exchanges (DBT) are made through JAM mode. This will help individuals to get computerized exchange mindfulness. Smooth, straightforward and secure installment procedures will achieve behavioral changes and speedier reception of advanced installments and keeping money among un-kept money fragments. At the point when new players enter the market, each with a marginally extraordinary go up against the market and with contrasting plans of action, the expanded rivalry will help the Condition and offer more alternatives for purchasers to browse. A bigger pie with more players is unquestionably useful for the changing elements of the installments business, which is as yet beginning in India. Serious conflict and vital joint effort among existing and new market members like the installments what's more; little banks and wallets will help scale up acknowledgment and encourage greater innovativeness, development and shopper decision. As per him, the future holds energizing circumstances for the installments business in India, as all partners also, administrative experts meet up to accomplish a "less-money subordinate" and in the end "cashless" society. This industry has been becoming consistently finished the previous couple of years. Card exchanges, both by charge and MasterCard s, are on an upward direction. There are Stimulating progressions at play in the Indian installments industry. Page 20242

5 Conclusion: Cashless exchanges or electronic exchanges dependably lead a computerized confirmation gainful for both the citizen (Consumer) and expense gatherer (government).cashless exchange is a help regarding handling expenses and holding up time. On the off chance that actualized legitimately it will expand the utilization and generation rates in this way enhancing the economy. The administration needs to make the fundamental strides and make some strategy contemplations when they are get ready for a cashless economy. The installment frameworks must be shielded from the digital assaults which are the significant risk for cashless exchanges. Likewise, the administration ought to have the capacity to serve the under kept money too. Everybody from the general public ought to approach an electronic framework that they can use for such exchanges. Government should take measures to expand liquidity into the framework so individuals confront fewer burdens. Government ought to likewise attempt to enhance general foundation with the goal that an ever increasing number of individuals can come into keeping money net and web. Society has likewise to have its impact. They need to comprehend the significance of cashless economy and acknowledge measures taken by the legislature. As a conclusion, one might say that going cashless gives significantly a greater number of advantages than only comfort to individuals, organizations and the administration specifically. References: 1. Dr MeenuJain, Globalization and Social Transformation: Indian Experience Research Process June 2014, pp Social Research Foundation. 2. Dr MeenuJain, Structural Change in the Course of Economic Development; India s experience Vol.5 issue 5, pp Indian Journal of applied Research Journal May Mishra G. Indians Get Elastic with Plastic Money, the Economics Times Retrieved April 02, 2008 from economictimes.indiatimes.com/ articleshowl cms 4. Kaur M, Kaur K. Development of Plastic Cards Market: Past, Present and Future Scenario in Indian Banks. Asia- Pacific Business Review 2008; IV (4): Nath R, Schrick P, Parzinger M. Bankers perspectives on internet banking. E-Service Journal 2001; 1(1): Dr. Subhani, MD Imtiaz. Plastic Money/Credit Cards Charisma for Now and Then with emphasis on affordability and preference of them by consumers because of their convenience attribute during all kind of daily transactions. European Journal of Scientific Research 2011; 62(1): Haq T, Malik B. Consumer response towards the usage of plastic money with emphasis on increase of shift of plastic money in India by consumers from Credit cards to Debit cards. International Journal of Multidisciplinary Research 2014; 4(5): Irma Wallace Future and Scope of Cashless Economy in India Apr 6, 2017 Finance & Money Info graphics Websites: nsaction_(india) 3. EnoeP7dZITeh21MRM/Making-India-acashlesseconomy.html 4. ion/editorial/cashless-indiaeditorial/article ece Page 20243