Cash Less Economy

What was the issue?

State bank of India started promoting cash less transactions.

What is digitized economy?

• Digital economy refers to an economy that is based on digital computing technologies.
• The digital economy is also sometimes called the Internet Economy.
• Increasingly, the "digital economy" is intertwined with the traditional economy making a clear delineation harder.

What are the advantages of digital economy?

• Transactions are digital, no need of safe guarding physical currencies.
• Time saving and faster means of exchange.
• The government able to track any transaction.
• There is increasing tax revenue.
• Dealing with criminal transactions is easier.

What are the issues with digital economy?

• Physical cash often offers the easiest and cheapest way to deal in many low-value transactions.
• It make no economic sense for small businesses to build the infrastructure required for digital payments
• Cash less economy would threaten the stability of the banking system.
• Cash acts as a natural check on inflationary government policies.

Source: The Hindu