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Why most people are skeptic about electronic transactions? It’s insecurity, the fear of internet fraud. Black money holders go for cash transactions for obvious reasons. But others go for it because of its ‘privacy policy’. You pay the money (cash) to buy something; nobody knows how much money is left in your pocket! But, swipe the card; it looks like the whole world got access to your bank account. Despite watertight methods to protect customers’ accounts by the banks, many still avoid electronic transactions due to fear of fraud. Then there is fear of tax by high-end consumers. The government has come out with a proposal to address both these concerns. If materialised, this will become another landmark policy move by the Narendra Modi government.

According to the government, the move is aimed at curbing black money and fake currency among other objectives. Besides the tax cut for consumers, it also proposes to give tax relief to merchants for electronic transactions worth over 50% of the total trade. The proposal of no transaction charges in paying at petrol pumps, gas agencies and for railway tickets is another key attraction towards electronic mode of payment. Besides, there is a proposal to provide discount for e-payment of electricity bill, telephone bill etc. And last but not the least is the proposal to put back the money in customer’s account in case of a ‘fraudulent transaction’ and block it till investigation is complete, limited to say three months. Many people, worried about safety aspect of e-payment, will get pursued by this proposal to make e-payment.

The outcome? After some years, there will be very little visible money left. It will be just numbers in one’s account. This will be a huge leap by India towards paper money, which took place of metal money just a few centuries ago, being replaced by electronic money. Importance of financial institutions like banks will grow tremendously. There will be swiping machine even in a small paan shop. Life will be much easier. There will be no need to keep change. No fear of pickpocket. But, there might be a time when one little snag in the server would make millions of people go hungry. A thunderstorm snapping electricity would paralyse trading even in a vegetable market. Intention of the government’s proposal might be very good, but it needs to look at all the pros and cons. The government has to visualise the outcome of such move at least 100 years down the line.

(Published as editorial in The Meghalaya Guardian on June 24, 2015)

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