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Cashless Economy in india Group Discussion Topic for Airforce Phase2 exam

Cashless Economy (Defination): 
The cashless economy refer to the flow of currency through electronic channels such as debit /credit card, internet banking, mobile banking, point of sales (PoS) etc.

 The caseless economic activity usually happens in three different modes namely mobile or e-wallet,  plastic money, internet banking.
Benefits of cashless economy: 
1. Transparency and efficiency : it make your transactions efficient and transparent.
2. Save money and time: One can transfer money from anywhere and anytime. 
3. It also provides  facilities like online shopping and online education.
4. It helps to remove black money from the Indian economy. It also remove the middleman and help to deposit subsidiary Benefits directly into citizens account.

5. Young population:  As per Census 2011 75% of Indian population is below 45 years of age. This young generation is very sensitive to to environment and prefer this fast and smooth transaction, so they prefer digital transactions over case.

6. Availability of Bank account:   80% of Indian adults have bank accounts as per the Global findex report this shows people will definitely adapt Cashless Economy.

7. At the time of globalisation adaptability to the digital world brings new opportunities for startups.

8. Reduce theft 

9. Easy to track black money

10.  Tax compliance and increased tax revenue to the government

11. Environment friendly:  Implementation of cashless economy will save cutting of trees and reduce deforestation and good for health of well being and our planet Earth.

12. Reduced physical robbery: Less circulation of case will lead to the less physical theft or Robbery it also reduce fake currency.

13. Direct benefit transfer: It reduce the middle man charges and govt can directly transfer the amount to the account of beneficiary. Cumulatively, Government had saved ₹1.4 trillion till March 2019 due to Direct Benefit Transfer (DBT).

Demerits of Cashless Economy
1. Hacking: Hackres are at the peak nowadays and they can steal money from people who do not have much idea about security.
2. Lack of knowledge:  People who doesn't have enough knowledge and do not know how to use smart phones will affected a lot.
 3. Access to the internet: India is a developing country and most of the people live in the rural areas, everyone does not have access to the internet 

4. Poor digital literacy:
5. Lack of proper infrastructure:
6.  Cyber attacks :
7. Trust issues among senior citizens:


Conclusion:  Government of India Plans to digitise every corner of the nation but it is still in a long run unless every citizen is made aware about digital economy. It makes our life easy simple and fast so we have to support cashless economy. 

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Cashless Economy- 

●A situation where the flow of cash within an economy is non-existent and for the transaction purpose digital gateways has been used is called the cashless economy. 
●The electronic media such as debit cards, credit cards, immediate payment services (IMPS) and net electronic funds transfer (NEFT) etc. 
●India is having one of the highest cash to GDP ratio. We are the fourth largest user of cash in the world.
● A cashless India will not only curb unaccounted wealth but also used for tax avoidance instances. 
●It will increase the transparency of the system. India will evolve as improvement in credit card system and better financial inclusion.

Advantages:
◆The cost associated with accounting and handling cash is high, it will reduce when we go cashless.
◆Less cash will decrease crimes like corruption, hawala transaction, theft cases etc. it will also increase the transparency in the system. The government needs to do measure related to online scam and theft incidents.
◆The production cost of coins and paper will reduce.
◆The government can use the data from transactions and improve their policies according to it like urban planning, energy management, housing etc.
◆It will also boost the economical growth as spending will be higher as compared to earlier, for example, Singapore witnessed 0.1% growth because of cashless transaction.

Disadvantages:
●Cybersecurity is another problem regarding the cashless economy, on October 2016 the details of over 30 lakh credit cards were feared to have been exposed at ATMs. Just a month later PM is motivating people to cashless. Is cybersecurity in place?
●The sudden surge in card transaction will lead to connectivity issue while demonetisation period. Connectivity issue needs to resolve before dreaming the cashless society.
●Internet cost is sustainability high in India, no wi-fi at public places.
●Not enough bank accounts for every individual is another hurdle.
●Proper infrastructure needs to be in place, the bank should be fully equipped.
●Smartphone availability and public infrastructure should be there to support a sustainable mobile society, eg. Public charging points.

Future prospects:
◆To change in behavioural patterns one needs to provide smooth secure and simple payment processes. The rapid growth of smart phone, e commerce sites, card payments options will increase the faster adoption, innovation and more option to consumer choice. ◆According to Worldline India Card Payment Report 2014-15 the credit card base grew at 9.8 % in the past year which shows greater acceptance of credit cards by consumers. 
◆Card transaction both by debit card and a credit card are on an upward trajectory. 

◆◆The private sector has to come forward to drive the change and government should also give some incentives for the electronic transaction and together try to achieve first less cash dependant and then cashless society.
◆◆The cashless society is a welcome idea but without preparation, it will be a disastrous situation. The government needs to take some policy consideration, serving banks, more liquidity into the system, better connectivity. This all should be done to better convenience of the public.

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