Cashless society is where all the economic transactions are based on digital payments but not on the cash. It is not possible to achieve absolute cashless economy but making the cash transactions to minimum will be the target of any government.
Outcomes of cashless economy:
- Indirect tax compliance will be increased there by the governments income will be increased
- Monitoring and tracking of the digital payments is possible where the suspicious transactions can be identified
- Fake currency will not be able to play any damaging role in the economy
- Terror funding which happens profoundly in the form of cash can be curbed
- With increased bank accounts and their usage, banks will have enough credit to give loans and large part of the population will avail formal credit institutions
- Efficiency ,reliability and security of the digital payment systems
- 90% of informal sector uses 90% of the cash transactions in the country. Making them to turn to cashless methods at once become a huge challenge
- Huge digital illiteracy among the people will pose significant risk
- Creating necessary infrastructure to support digital payments like POS machines,Bank branches, technical support, power supply ,and human resources etc
- Make digital payments efficient,secure,reliable and innovative
- Initiatives to improve the digital literacy by governments,NGOs ,communities and individuals
- Making digital payments less expensive and incentivizing them
Though Cashless economy benefits everyone in the future, it has many risks and challenges. If they are properly handled , this will help India to become a prosperous country.