Nobel laureate Prof Muhammad Yunus has said the demonetisation had to come some day.
Highlighting one of its benefits, he said it will has brought the rural and unorganised sectors into the banking fold.
He said India’s note ban move has killed black money and has increased liquidity.
Yunus regretted that in all countries including India a large number of people were left out of the banking system in particular, and the financial system in general. He said, “we have to find ways to bring them into the system and the system should also be redesigned to suit their needs. Conventional systems will not work.”
As the Centre moves towards a cashless environment after demonetisation, experts believe it offers many advantages than disadvantages.
Here are some of them:
Going digital will ease how one conducts financial transaction. You will no longer need to carry wads of cash, plastic cards, or even queue up for ATM withdrawals. While traveling, it is easier and safer option. Going cashless gives you the freedom to transact whenever and wherever you want. Moreover, you don’t have to be physically present to conduct a transaction or be forced to do so only during office hours. It is also helpful in case of emergencies.
Digital payments gives the government an edge in enhancing its taxation system. India’s informal economy is responsible for roughly 45 per cent of GDP and 80 per cent of employment, meaning billions of rupees are being exchanged each year without the tax collector taking his cut. As of now only 1 per cent of India’s population pays income tax.
Curb on fake currency
Fake currency can harm the monetary policy of the country adversely, besides being illegal and almost equivalent to theft.
Putting a check on corruption and black money
People who have accumulated substantial amounts of ill-gotten wealth will think of different ways now. The demonetisation will positively impact the state of the Indian economy by choking off the stock of liquidity which finances black activities.
To promote digital transaction, the recent waiver of service tax on card transactions up to Rs 2,000 is one such incentive. This has been followed by a series of cuts and freebies. It’s a good time to increase your savings if you take advantage of these. For instance, 0.75 per cent discount on digital purchase of fuel means that the petrol price in Delhi at Rs 63.47 per litre can be brought down to Rs 62.99/l with digital payment.