After the earth-shaking announcement of Hon. PM Narendra Modiji to wipe out Rs. 500 and Rs. 1000 notes, people are now slowing wondering why they had kept so much cash in their houses at all. As per a report by SBI, in the last 2 days people have deposited more than Rs. 53,000 crores in SBI alone. This is not a small amount and to say that this was only black money would be a gross mistake. T

he fact is that an average Indian keeps cash in his house for various small and medium sized expenses like buying groceries, clothes, etc. There is no religious occasion where, cutting across religions, money does not change hands, in a regular family. It is also true that almost all Indians have got into the bad habit of encouraging bribe-taking and cash transactions in order to cut down on paperwork, save time, refrain from paying indirect taxes, etc. Every regular Indian thinks that he is not doing any wrong because he feels that he is not getting his rightful share of facilities even though he pays his taxes.

As we make a new move towards cashless transactions, we would request the Government to pay attention to a few areas and make some changes wherever possible:

  • If more and more people are to use plastic money in the form of Debit cards or Credit Cards, it goes without saying that the current transaction tax of approximately 2% + service tax should be discontinued forthwith or at least substantially reduced. This will encourage a lot of people to use plastic money instead of cash.
  • Bank charges levied on internet banking or cheque transactions below a certain limit should be scrapped so that first-timers too start making their payments through banks.
  • Indirect taxes and the cess/tax over and above these taxes should be reduced so that there will be no incentive for people to cheat and make cash payments.
  • Small traders, shopkeepers, kirana-walas, vegetable vendors, beauty parlours, hotels who have ‘pucca’ shops and establishments should be encouraged to have card-swiping machines in their shops. Currently very few of these establishments have any incentive to encourage plastic money and thus even if a regular family spends at least Rs. 3000 per month (assuming credit given and monies settled at the end of the month), they have to settle in cash.
  • For hawkers and those who do not have ‘pucca’ shops and for taxi or auto drivers, encouraging them to settle payments through Paytm or other such applications is a must. But they have to be trained for this first, since many of them are illiterate or do not have easy access to smart phones.
  • Settlement of all fines for traffic violation, encroachment of space, stealing of electricity, etc. should be made compulsorily through bank transfers alone. The bill for the same should be raised automatically and sent to the current address and if payment is not done within the stipulated time, jail sentence should be made compulsory. This will reduce bribes and also repeat violations.
  • Jewellery shops should compulsorily accept only plastic money or cheques. Surprise checking should be done on these shops and they should be fined heavily if cash over a certain limit is found in their registers or bank accounts. This will prevent people from buying gold, silver or precious gems to cover up their black money.
  • Wedding caterers, decorators, make-up artists, ground/room providers should compulsorily be settled only by cheques, bank transfers or card. They should be ‘encouraged’ to give proper receipts to their clients and maintain books of accounts, failing which they should be heavily fined.
  • Water tanker mafia is one of the biggest mafia in cities like Mumbai where there is a perennial shortage of water supply. It is a known fact that these people deal mainly in cash. They too should come under scrutiny.

While we have listed out some of the steps that will encourage the flow of money through cashless transactions, we have to remember that there are many people who will still not be able to do it. This includes aged people who are immobile or restricted to their homes and have to depend on home deliveries and cannot pay through card, cheques etc. This also includes maids, daily wage earners, labourers, load lifters, etc. who cannot go to banks daily for encashing their cheques or withdrawing money. Dealing in cash has become more of a habit and tradition in our country. It is a habit that will take some time to break, but by taking bold decisions, it is one that can be broken.

We salute the present Government, under the able leadership of Modi ji, supported by our Finance Minister and RBI, to have taken this bold step. We, the citizens of India, are with you ever step of the way in creating a Swachh Bharat. Jai Hind ! Jai Jawan, Jai Kisan, Jai Vigyaan !!!


Rati Hegde