(MENAFN- NewsBytes)
Digital India: Will we soon lose cheque books too?
21 Nov 2017
According to Confederation of All India Traders (CAIT) Secretary General Praveen Khandelwal, the Indian government is mulling yet another disruptive move towards a cashless economy: abolishment of the cheque book.
The effects could be massive. Most business transactions are conducted through cheques. 95% transactions currently take place via cash or cheques.
There have been mixed trends, but cashless payments have overall increased post demonetization.
The government's concerted efforts towards a cashless economy
Digitalization
The Narendra Modi government has focused on movement towards a cashless economy. Benefits are several: no hassle of carrying cash, ease of tracking expenses, lower risk of theft and more.
To meet its aim, the government has launched several measures and come with new digital payment apps like BHIM.
UPI, which was the first such system in India, now facilitates instant fund transfer.
Effects of demonetization have largely been mixed
Effect
There have been mixed reports on demonetization's effects. The NPCI claimed transactions through UPI have shot up by 77 times.
However, other reports attributed an initial surge in digital transactions to lack of cash.
According to The Indian Express, value of mobile wallet transactions went up from Rs. 3,385cr in October'16 to Rs. 8,353cr in March'17, then fell to Rs. 7,262cr by August'17.
Will withdrawing the cheque book help?
Future
Now the government is considering withdrawing the cheque book facility in the "near future", says CAIT Secretary General Khandelwal.
However, it will have to complement the move by "providing subsidy directly to the banks" so charges on debit and credit card payments can be waived, he added.
As of now, only 5% of India's 80cr ATM-cum-debit cards are used for cashless payments.
MENAFN2111201701650000ID1096120139
Legal Disclaimer:
MENAFN provides the information “as is” without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the provider above.