The heat of demonetisation has reached into government offices too. Recently the Prime Minister Modi has been giving a call for making India less cash economy. The same principle has been applied for all payments made by the government offices. The new decision by Ministry of Finance of Union Government has said in a notification that all government departments should adopt digital payments for any order value which exceeds Rs 5,000. This is another step towards cashless transactions post demonetisation as lot money is paid through government departments.  The earlier limit was Rs 10,000.

“All the ministries and departments of the government of India have been now directed by the ministry of finance to ensure with immediate effect that all payments above Rs 5,000 to suppliers, contractors, grantee and loaner institutions etc are made by issue of payment advises only,” the statement said.

The Ministry of Finance also separately asked all ministries or departments to encourage their employees to use debit cards for personal transactions instead of cash.
Through this, the government wants to make the government servants as the ‘ambassadors’ for digital transactions and encourage the general public towards cashless transaction.

The government has distributed Rupay cards under Pradhan Mantri Jan Dhan Yojana for most of the account holders. So, if micro atms are provided at local levels and card swiping machines are also made available as soon as possible by the banks, then it is easy to expand card payment system. However, care should be taken that the illiterate or uneducated people are not cheated through the sellers or shop owners and a robust grievance redressal mechanism is set up with a provision of punishment so that it becomes deterrent for those who might involve in cheating.

Additionally, the Finance Ministry has also directed the PSU and private banks to waive the transaction costs for all payments made through debit cards.

Along with that, in an interesting development, the Ministry of road transport has asked vehicle manufacturers to provide a digital tag on all new cars for e-payments at toll plazas and checkposts. This will make toll payments much easier and quicker.

Since August, Government has ensured that the procurements for the government departments and ministries would happen through the Government e marketplace, which has brought significant reduction in corruption in procurement process. Similarly, the digital payment system that the government has instructed would make it difficult for the officials to indulge in unethical and corrupt practices.

The Prime Minister is taking all the steps which are totally in agreement with his statement “Na Khaaoonga, Na Khaane doongaa”. It is being applied on bureaucracy, ministers, elected representatives of his party and so on. The digitization process has started since e-auction under this government has moved into every personal account level. It definitely gives a feeling that something more to come.


Akshara Damle

You can reach the author on twitter @aksharadamle