Essay on "DIGITAL PAYMENTS - Issues and
Opportunities in India"
Answers
Answer:
Two years ago a father was five times as old as his son. Two years later his will eight than that of three times the age of his son. Find the age of the father?
Answer:
India is a massive cash dependent economy with a 13% cash-to-GDP ratio to the global average of 2.5 to 8%. This invites many illegal transactions and black money within the system. The government hence, figured out that going cashless can be a solution to reduce these money laundering transactions, and a fair play in the economy of the country will persist.
In 2005, a tax named ‘Banking Cash Transaction Tax’ was one of the steps taken towards the removal of black money by the then finance minister of U P A government, which levied a tax of 0.1% on withdrawals of cash above 10,000 rupees. But this mainly focused on the banks, while blurring the cash users like merchants or businessmen.
Since the attack of demonetization by the government has been taken, digital and online transactions have had a steep up-rise in its graph. The rate of digital cash users is increasing exponentially day by day. Mobile transaction applications like Pay TM says that there has been a 200% increase in its mobile app downloads in recent times and a 250% increase in their recent transactions. Applications like MobiKwik, Oxigen and U Pay also reports the growth of digitization in their statistics after the widespread of demonetization.
Demonetization is the biggest and the most effective step taken so far by the Indian government towards digitization. The dumping of 500 and 1000 notes has triggered the wealth of black money holders massively. Though the economy country-wide has dropped, the black money and big-fat illegal cash transactions have also been minimized greatly.
New portals for online digital transactions have been opened on a wide-scale, encouraging more customers or users of cash to dump the old techniques and go cashless.
The government must propose more secure and tight algorithms to stop the intervention of cyber attacks on top security databases for big companies, governments and systems, as well as on personal accounts for the public.
Going digital will help in keeping track of the monetary transactions taking place and will pose more security on individual’s wealth. Digital payments will also be a step for an eco friendly environment as the usage of paper reduces. A drawback factor to the making of a digital India will be the high rates of illiteracy and poverty.