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Is India ready to move towards Digital Economy?

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Re: Is India ready to move towards Digital Economy?

Post by Dheeraj Mohan on Sun Dec 25, 2016 8:28 pm

No, I don't think so that India is ready to move towards cashless economy. the move of turning your economy to a cashless economy is good for the countries that are already developed not for the countries that are still miles away from the developed stage. its seems like a great dream but it can easily turn into a nightmare for the Indian economy. the only reason India could survive the 2008 world recession (due to the crash housing bond) was because of the black money or unaccounted money people were having with themselves.
>Internet is what we use to carry out our cashless transaction and guess what India is at the rank of 105. the lowest in the Asia-pacific region.
>the literacy rate of India is not at that stage where we can handle the cashless economy.
I would conclude with that it is a good move by the Indian government but i don't think that we can handle the responsibilities of the cashless economy.

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Re: Is India ready to move towards Digital Economy?

Post by Neha Choudhary on Sun Dec 25, 2016 8:44 pm

Talking about a digital India , though the cashless transactions have increased these days but it would not be apt to say that India is ready towards digital economy considering its high proportion of digital illiteracy and cash transaction, awareness,connectivity and internet infrastructure have also been major hurdles for digital payment. While urban centres mostly enjoy high speed internet connectivity, even semi urban areas are deprived of a stable net connection.Cashless Payment system is entirely based on Internet connectivity. In India only 34.20 cr people i.e 27% of the total population (13% of rural population) have Internet connection.Thus such a low level of Internet penetration is proving a major deterrent.Also local Bricks and Mortar shops are not ready or rather not able to afford the PoS (Point of Sale) machines which is the basic requirement for online transactions. As per data available in India for the sample of 10 lacs population only 856 POS machines are available. The attitude of people is also playing a major role as majority of people are still skeptical about online transactions fearing fraud and being cheated. Even though India has more than 200 million smartphones, it is still some time away for rural India to seamlessly transact through mobile. India is not ready for this transformation, but in near future India will be able to transform into a cashless economy by having necessary infrastructure required for this.

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Re: Is India ready to move towards Digital Economy?

Post by ashishgupta on Sun Dec 25, 2016 9:18 pm

Yes, India today is ready to move towards digital economy. The sooner the economy moves to a digital economy there will be less wastage, more productivity, more evolution and less of a black economy. Digital India has the potential to harness the talent of the young India. And if cashless economy is incorporated in it, it would actually make economy grow faster and grow clean.Demonetization is the one of the major reason to shift economy to digital economy. It is good for the country as it will increase transparency and decrease black money as well as corruption in the country.Some people are also moving towards cashless habit. Now a daysevery thing is available online and we can easily get it with easy payment gateway. Also at many places paytm is accepted and some people feel comfortable to pay through paytm.Some people are also moving towards cashless habit. Now a daysevery thing is available online and we can easily get it with easy payment gateway. Also at many places paytm is accepted and some people feel comfortable to pay through paytm. as we all know India is still a developing country due to which it needs a lot of time to transform itself into cashless economy. Though no. of bank accounts have increased drastically after the demonetization, once the scarcity of new notes is reduced, there is no guarantee that everyone will use that bank accounts.Digitization also ensures that the public goods and services are reaching people effectively. Whether it is banking, railways or even Public distribution system, it makes their delivery faster and easier to keep track with.India is currently in the middle of an all-out movement to modernize the way things are paid for, even the vegetable vendors on the streets have opened up paytm accounts and they have a machine outside their shop where someone can scan the bar code and make the payment.

So Yes, I agree With it that India is ready to become a cashless economy or Digital Economy.

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Re: Is India ready to move towards Digital Economy?

Post by Chander singh on Sun Dec 25, 2016 9:18 pm

Yes, India today is ready to move towards digital economy. The sooner the economy moves to a digital economy there will be less wastage, more productivity, more evolution and less of a black economy. Digital India has the potential to harness the talent of the young India. And if cashless economy is incorporated in it, it would actually make economy grow faster and grow clean.
The demonetisation drive has forced millions of Indians to not just queue up at ATMs but also fall in line with the government's digital push, even as online payment services firms are laughing all the way to the bank. In a nation where most consumers have been dealing in cash till now, the currency switch has provided the Centre an opportunity to give a big push to electronic transactions to improve transparency and weed out black money. The government expects the move to pay off as cash-starved consumers are taking the plunge to cross the psychological barrier of switching to digital transactions with which they were uncomfortable until now.
At present, digital payments account for 15 per cent of the $1.5 trillion worth of consumer spending in this country. This could rise to 60-70 per cent of overall consumer spending in the next two years, said Mrinal Sinha, operations head at e-wallet company MobiKwik. The scope appears to be reflected in the sudden surge in transactions of e-wallet companies such as Paytm, MobiKwik and FreeCharge. Mobile payments and commerce platform Paytm claimed it crossed seven million transactions worth Rs 120 crore on November 22. Tea and vegetable sellers in most parts of the city began transaction through digital wallets while the parking lot operators particularly in malls too accepted payments through cards of e-wallets. Similarly, patients had the option of paying doctors' fee through e-wallets at many private clinics and hospitals.
Thus, we can say that India is moving towards digital economy.

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Re: Is India ready to move towards Digital Economy?

Post by Aarya Gupta on Sun Dec 25, 2016 9:53 pm

The statistics are startling. Just about 2% of the volume of economic transactions in India are cashless.

Less cash would mean less black money...less corruption...and more transparency.

But is India really ready to go digital?

i don't think so. In my view, digital India is a way distant dream...particularly for rural India.

Consider the following statistics...

As per Newslaundry.com, there were 5.3 bank branches per one lakh Indians in rural India 15 years ago. Today the figure stands at 7.8 bank branches per one lakh Indians. This shows that a majority of rural India has very little access to banks and the organized financial sector. They rely heavily on cash and the informal credit system.

Then, we have just 2.2 lakh ATMs in the country. For a population of over 1.2 billion people, that's a very small number. And guess what? A majority of ATMs are concentrated in metros and cities. For instance, Delhi has more ATMs than the entire state of Rajasthan.

Given the poor penetration of banks and formal sector financial services in rural India, we believe that Modi's cashless economy ambitions are a distant dream.

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Re: Is India ready to move towards Digital Economy?

Post by Aastha Ahlawat on Sun Dec 25, 2016 10:10 pm

Undoubtedly India is ready or somewhere force to move Digital Economy because in my point of view government is having money but they are not allowed one person withdraw cash of 2500 in one day so basically vendors and normal people are shifting towards digital with no option .and its fare enough dis is in the favor of everyone.
In-fact slowly and slowly rural areas will also adopt this digital technology.One more thing their is no strike or some curfew kind of thing after demonetization because everybody know its in our nation's favor.
Paytm is running like anything and everybody want to know and learn about online payment and transactions and the situation will be go cashless.
Also I would like to add it will take time but very soon most of the economy will become digital.Digital revolution, also known as ‘The Internet Economy’ or Internet of Everything (IoE), is expected to generate new market growth opportunities, jobs and become the biggest business opportunity of mankind in the next 30 to 40 years.
Moreover,in my point of view demonetization played a major role in this step,though its intentions for the country’s economy appear positive, the move has not been well received by the common man. Tempers are flaring and some are warning of riots over the abrupt change. The poor, who are unused to dealing with banks, have mainly been left by authorities to wait in long lines outside financial institutions simply to figure out what to do with their notes.

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Re: Is India ready to move towards Digital Economy?

Post by Kunwar Kartikay on Sun Dec 25, 2016 10:12 pm

After demonitization has taken place, shortage of cash has significantly increased the use of digital modes of payment, but the actual shift will only be visible after the cash crunch eases.
It is possible that a section of people which has used electronic mode of payment for the first time due to the cash crunch will continue to transact through this medium, but there are still a number of hurdles in making India a cashless economy.
First, a large part of the population is still outside the banking net and not in a position to reduce its dependence on cash.

Second, about 90% of the workforce, which produces nearly half of the output in the country, works in the unorganised sector. It will not be easy for the informal sector to become cashless, and this part of the economy is likely to be affected the most because of the ongoing currency swap.

Although cashless transactions have gone up in recent times, a meaningful transition will depend on a number of things such as
awareness,
technological developments and
government intervention.
For instance, mobile wallets have seen notable transaction, and it is possible that a large number of Indians will move straight from cash to mobile wallets.

However, a material transition to a cashless economy will depend on a number of factors.
First, the availability and quality of telecom network will play an important role. Presently, people face difficulties in making electronic payments even in metro cities because of poor network.
Second, as one of the biggest beneficiaries of this transition, banks and related service providers will have to constantly invest in technology in order to improve security and ease of transaction.
People will only shift when it’s easier, certain and safe to make cashless transactions.
Third, the government will also need to play its part. It will have to find ways to incentivise cashless transactions and discourage cash payments.
So, I don’t think so that it’ll be that easy for India to be a cashless economy until government fixed up the gap that is available in our economy.

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Re: Is India ready to move towards Digital Economy?

Post by Ravi Sharma on Sun Dec 25, 2016 10:14 pm

The toughest part of the digital economy triangle is changing the habits of a population that has been used to cash for over a millennium. This is perhaps the toughest part of the transformation sought
That is just one side of the equation. The other side—that of banking and payment systems that are needed for online transactions— is probably even more skewed. Over the last decade, mobile telephony has boomed, but the banking sector has lagged far behind. Until 2014, the vast majority of Indians remained unbanked and, few, if any efforts were made to make banks respond to the needs of the poor. That year, the Government launched its no-frills, zero-balance, account scheme to ensure that everyone signed up. Since then, the number of these accounts has swelled to approximately 255 million in early November. At least on this score one can have the satisfaction of seeing positive changes. The sooner the economy moves to a digital economy there will be less wastage, more productivity, more evolution and less of a black economy. Digital India has the potential to harness the talent of the young India. And if cashless economy is incorporated in it, it would actually make economy grow faster and grow clean.Demonetization is the one of the major reason to shift economy to digital economy. It is good for the country as it will increase transparency and decrease black money as well as corruption in the country.Some people are also moving towards cashless habit. Now a daysevery thing is available online and we can easily get it with easy payment gateway. Also at many places paytm is accepted and some people feel comfortable to pay through paytm.Some people are also moving towards cashless habit. Now a daysevery thing is available online and we can easily get it with easy payment gateway. Also at many places paytm is accepted and some people feel comfortable to pay through paytm. as we all know India is still a developing country due to which it needs a lot of time to transform itself into cashless economy. Though no. of bank accounts have increased drastically after the demonetization, once the scarcity of new notes is reduced, there is no guarantee that everyone will use that bank accounts.Digitization also ensures that the public goods and services are reaching people effectively.
So Yes, I agree With it that India is ready to become a cashless economy or Digital Economy.

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Re: Is India ready to move towards Digital Economy?

Post by harshitadaga on Sun Dec 25, 2016 10:24 pm

I believe our government is taking significant step to get India ready for a cashless economy. At the same time the various schemes that the online payment portal companies like paytm are launching are actually encouraging the common man to switch to digital economy. Paytm, Mobikwik, Freecharge and Oxigen Wallet have made huge inroads in the state in the past few weeks. for instance - The overall traffic for Paytm in Kerala increased by 40 per cent after the demonetisation of high-value currencies by the Central Government and the offline transactions witnessed a 45 per cent growth spurt.
Moreover, Instead of wondering whether India is ready for a cashless economy, we much actually think of every measure possible to make India "cashless - ready", This is because its high time and India must get in the race and start functioning like the other developed and successful economies of the world. There are n number of benefits attached to paperless money like - increased transparency of transactions, improved economic growth and development of the country, reduced black money etc.
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Re: Is India ready to move towards Digital Economy?

Post by Sheenajain on Sun Dec 25, 2016 10:34 pm

Yes,the demonetisation move by the Indian government would reduce the role of blackmoney and will lead the country towards a digital country but for a country like India to become cashless will take time because only about 2% of the volume of economic transactions are cashless. Though it is a great move, it will not only bring transparency but the corruption will also be removed. As less cash means less black money!

The rural area is the major part of our economy and they are not aware about the digital world. As Even after major steps taken by Government for financial inclusion in the form of Jandhan Yojana majority of rural population are without Bank accounts which is must for being a participant of any cashless system.
Cashless payment system is entirely based on Internet connectivity and In India only 27% of the total population (13% of rural population) have Internet connection. Thus it is a big problem.

M-commerce or Payment through mobile requires smart phones and good level of e-literacy which currently rural India is lacking.Only 17% of adults have access to smart phones and only 15% of the total mobile connections have internet connectivity.

Thus presently, India is not ready for this transformation, but in near future India will be able to transform into a Digital economy by having necessary infrastructure required for this.A 100% cashless society is undoubtedly impossible. So I think it is reasonably fair enough to assume that if atleast 75% of transactions in the country start happening digitally then we can call ourselves as Digital Society.

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Re: Is India ready to move towards Digital Economy?

Post by shubham jaiswal on Sun Dec 25, 2016 10:35 pm

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

How demonetisation has pushed India towards a digital economy

The demonetisation drive has forced millions of Indians to not just queue up at ATMs but also fall in line with the Narendra Modi government's digital push, even as online payment services firms are laughing all the way to the bank.
At present, digital payments account for 15 per cent of the $1.5 trillion worth of consumer spending in this country. This could rise to 60-70 per cent of overall consumer spending in the next two years, said Mrinal Sinha, operations head at e-wallet company MobiKwik. The scope appears to be reflected in the sudden surge in transactions of e-wallet companies such as Paytm, MobiKwik and FreeCharge.


*Opportunities for India in the Digital Economy:-

The digital economy is the new productivity platform that some experts regard as the third industrial revolution. Digital revolution, also known as ‘The Internet Economy’ or Internet of Everything , is expected to generate new market growth opportunities, jobs and become the biggest business opportunity of mankind in the next 30 to 40 years.
Goldman Sachs predicts that India - comprising 15% of the world population, with a growth rate of 7 to 8%, could be the second largest economy by 2030.

*Major Advantages:
1. Creation of Digital Infrastructure and Electronic Manufacturing in Native India.
2. Digital Empowerment of Native Indian People.
3. Delivery of all Government Services electronically (E-Governance).
4. A Digital Identification which will verify the end user.
5. A Mobile for worldwide access to all services.
6. A Bank account for Immediate Benefit Transfers of subsidies and payments.
7. The program also aims to eliminate all electronics imports from foreign countries by 2020 and make India a electronics manufacturing super power.

*DISADVANTAGES :

1. Government employment might reduce which in turn may lead to civil servants' unrest.
2. People will use free wi-fi just for time pass which is current scenario in metros.

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Re: Is India ready to move towards Digital Economy?

Post by kratika mishra on Sun Dec 25, 2016 10:38 pm

Is India ready to move towards digital economy? To this question I will not support the statement instead will say, no, India is not at all ready to move towards digital economy, this can be supported with the recent news which says that around 70% of country’s population still lives in rural areas, and the people out there do not welcome the concept of digital economy with open hands, the do not accept the things on a go. May be after a year or two, or even more then that the people will think of moving to digital economy, but as of now, there are minimum or no chances of this thing.
Not only this, there is lack of accessibility in most of the shops, which will make it hard for people to pay for the commodity they want to purchase, there is lack of information to the people in the villages and there are culture barriers as well.
Atlast I will say, though demonetization was a great move, but taking it as a step to take India towards digital economy is a big NO at this point of time.

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Re: Is India ready to move towards Digital Economy?

Post by Vartika Shukla on Sun Dec 25, 2016 10:44 pm

"In this digital age , we have an opportunity to transform the lives in a ways that was hard to imagine a couple of decades ago " said by Mr.Narendra Modi. INDIA BEING DIGITALISE. It amazing to listen. Our survey of more than 100 large companies, aimed at understanding the intent, interest and intensity within corporations to embrace digitalization, revealed heightened interest within businesses about digital technologies and digitalization. This move of our country will lead to decrease unemployment and will increase per capita income . The government is taking a big advancement to convert the nation into a digitally motivated knowledge economic system.

some of the major advantages of digitalisation are -:

1 . Creation of Digital Infrastructure and Electronic Manufacturing in Native India.
2 . Digital Empowerment of Native Indian People.
3 . Delivery of all Government Services electronically (E-Governance).
4 . A Digital Identification which will verify the end user.
5 . A Mobile for worldwide access to all services.
6 . A Bank account for Immediate Benefit Transfers of subsidies and payments.
7 . The program also aims to eliminate all electronics imports from foreign countries by 2020 and make India a electronics manufacturing super power.
India need revolution and enhancement to improve us and make INDIA FULLY INDEPENDENT.

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Re: Is India ready to move towards Digital Economy?

Post by himashish on Sun Dec 25, 2016 10:44 pm

The sooner the economy moves to a digital economy there will be less wastage, more productivity, more evolution and less of a black economy. And if cashless economy is incorporated in it it would actually make economy grow faster and grow clean.
At present, digital payments account for 15 per cent of the $1.5 trillion worth of consumer spending in this country. This could rise to 60-70 per cent of overall consumer spending in the next two years, said Mrinal Sinha, operations head at e-wallet company MobiKwik. The scope appears to be reflected in the sudden surge in transactions of e-wallet companies such as Paytm, MobiKwik and FreeCharge. Mobile payments and commerce platform Paytm claimed it crossed seven million transactions worth Rs 120 crore on November 22. Tea and vegetable sellers in most parts of the city began transaction through digital wallets.
"I have not run into a single person who criticises this. Prime Minister Narendra Modi’s focus on startups as engine of job growth, unfortunately for India is 70 years late. But at least he started the process. I wish the first prime minster of India had focused on entrepreneurs not with suspicion and distrust, but with confidence and trust," Shukla said. Targeted financial education programmes can improve financial skills and credit management, and increase account ownership. Thus, we can say that India is moving towards digital economy.





























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Re: Is India ready to move towards Digital Economy?

Post by Harshita Sharma on Sun Dec 25, 2016 10:57 pm

India has gone through a lot, after Demonetization was dropped on it. For a country with major population living in rural areas where electricity is not fully available, thinking of complete digitalization will be a joke.
“Rome wasn’t built in a day”, Complete digitalization is truly a noble idea, but expecting India to change just like that is not as easy as walk in the park.
The reasons why digitalization will take its own sweet time are rural settlement, old mindset, techno-phobia, access to internet (not everywhere), etc.
Although India has shown quite a progress with payment through e-wallets, net banking etc., which has brought boom in the e-commerce market. E-wallet companies like paytm, payUmoney, mobikwik, state bank buddy etc., are minting profits out of current scenario, and people are getting used to it. Still there is a hint of concern for the rural people and their livelihood that majorly depends on cash transactions.
At last it can be concluded that Digitalised India is a practical idea, but it lacks practical approach.

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Re: Is India ready to move towards Digital Economy?

Post by Rhythm on Sun Dec 25, 2016 10:58 pm

In my opinion Indians are very emotional and tend to quickly come to conclusions without delving deep into issues. The public outcry against demonetisation — especially by those who are at the receiving end — is one good example where emotions run high, with few solutions at their hand to face the problem of cash crunch.
One can’t do much, but to sympathize with those who faced the brunt of PM Narendra Modi-led government’s abrupt demonetisation move on November 8,2016.
> The banking infrastructure in India is still weak in terms of reach and not large enough to cater to the teeming millions in interior India.

> Depending on one’s political leanings and personal financial situation, people have described the move as either an “economic robbery” or a “masterstroke” in the war against black money.

> With more than five weeks gone since the demonetisation announcement, there is no doubt that the Prime Minister is on the backfoot, with some of the initiatives, as part of the exercise, backfiring on the government.

Scheme for hoarders-
> Nobody expected — not even the government — Indians to return so much old demonetised notes (nearly ₹13-14 lakh crore) to the banking system, prompting the government to hurriedly design a scheme-Pradhan Mantri Garib Kalyan Yojana, a last and final chance for black money hoarders.

> The banking system-a key partner for such a massive exercise was ill-prepared to face the situation. The Reserve Bank has issued 60 directions and notifications after November 8, making life more miserable for those standing in queues. Either by design or coincidence, the absence of adequate new currency has left a bad taste among people, especially those who had to face withdrawal restrictions from banks. Bank officials themselves exploited the situation at the cost of small-time bank customers.

> The main criticism justified to a large extent against the government is that demonetisation has inflicted more pain on the poor and innocent while opening a window for the rich to cleanse their unaccounted income, of course, after paying a handsome share to the exchequer.

The jury is still out on whether demonetisation was the best route to tackle the fake currency problem.Since 16 out of 250 are fake notes.

But, one thing is clear that “Demonetisation alone can’t turn India cashless. It is only a signal to India and Indians that money in their hands has changed shape.”

Dominance of cash-
> The dominance and significance of cash in India’s monetary ecosystem is mind-boggling. A 2015 report by Price water house Coopers pegs cash transactions at 98 per cent of consumer transactions in value terms and 68 per cent in volume terms, much higher than comparable economies, such as China, Brazil and South Africa.

> The Jan Dhan-Aadhar-Mobile (JAM) trinity, Rupay Cards (which made a splash in 2014) and now Unified Payment Interface have put in place a robust base for India’s digitisation programme to take wings.

> There is huge potential that India holds in turning into a cashless economy going by the following data points. There are 104 crore debit/credit cards in circulation as of October 2016. As much as 88-90 per cent of debit card transactions are done at ATMs, with only 10-12 per cent of transactions occuring at point-of-sale (PoS) terminals.

> India barely has 2.1 lakh ATMs and 12 lakh PoS terminals to service such a huge population. It’s in this context that the Modi-led government’s directive to banks to add at least one million new PoS machines in the next three months should be welcomed.

> ‘Not a substitute for cash’
Our country has taken a huge step towards improvising digitisation in the economy. One would do well to pay heed to what Finance Minister Arun Jaitley said recently: “Digital transactions are a parallel mechanism, not a substitute, for cash transactions, and a cashless economy is actually a less-cash economy, as no economy can be fully cashless.”
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Re: Is India ready to move towards Digital Economy?

Post by ABHISHEK SINGH.1605 on Sun Dec 25, 2016 11:00 pm

As we all know India is still a developing country due to which it needs a lot of time to transform itself into cashless economy. Though number of bank accounts have increased drastically after the demonetization, once the scarcity of new notes is reduced, there is no guarantee that everyone will use that bank accounts. Though cashless transactions have increased these days, right now India cannot completely become a cashless economy considering its high proportion of digital illiteracy and cash transactions. But Indian Government is working towards increasing the share of cashless transactions, which is a good thing for any economy.
The government is giving incentives to people for going to online and card-based transactions in the country to achieve its target of becoming a largely cashless economy for e.g. Government is giving 0.5% discount to customers for monthly or seasonal tickets from January 1, 2017 and also 0.75% discount of the sale price to consumers on purchase of petrol/diesel if payment is made through digital means and various other incentives. At initial stages people will face loads of problems but beginning an initiative is always tough. A digital economy can lead to more trade,better capital use and greater competition.The digital economy promotes efficiency,competition,and trade and is thus capable of generating more wealth.




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Re: Is India ready to move towards Digital Economy?

Post by Varshita Rathore on Sun Dec 25, 2016 11:02 pm

Due to the recent change in the economy of the country i.e. demonetization, our economy is forced to go cashless due to unavailability of cash. Our economic experts gave it a name of ‘Digital Economy’ for better growth. No doubt right now the situation is chaotic, but it will definitely lead to a better picture in the near future. Right now India is covering very less share of digital transactions, but it is surely increasing. It will help India becoming transparent resulting corruption free nation. The nation is moving more of towards online payment methods like PayTM, Freecharge.
Surely our PM had taken a great step in shaping our economy as a digital economy but in reality, a huge sector of an economy is still unaware of these terms and not ready for such a huge step forward. Many people still have no bank accounts. Awareness is still not there in many sectors regarding digital methods of payments. For those having awareness online payment portals are not 100% safe way of transacting for them. Most importantly people should have IT knowledge to make themselves comfortable with payment tools and a safe online environment. It will help people to gain trust on online payment gateways.
Regardless of the fact that DIGITAL ECONOMY is one of the best idea for the economic growth but there is also a need to make people of the nation capable of using such a great technology and using it to the maximum extent.

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Re: Is India ready to move towards Digital Economy?

Post by sadashiv on Sun Dec 25, 2016 11:08 pm

In my opinion, Cash is set to lose currency in India, as an explosion in smartphone usage drives a digital payments boom, according to a new report.
+ By year 2020, nearly $500 billion worth of transactions in India will happen digitally, using online wallets and other digital-payment systems, 10 times the level currently, according to a report by Google India and The Boston Consulting Group.
+ Indians traditionally prefer to save and spend in cash, and a vast majority of the more-than 1.2 billion population doesn’t have a bank account.
+ Last year, 78% of all consumer payments in India were made by cash, whereas in developed countries like the U.S. and U.K., only 20% to 25% of such payments were made that way, the report said.
+ But the reliance on notes and coins in India is likely to diminish, as spending habits change and financial services reach more people, said the Google-BCG report. It expects cash-based consumer payments to fall to 40% to 45% by 2025.
+ A sharp increase in the use of mobile phones with internet connectivity will help drive the move to digital payments, said the report.
+ India has more than 1 billion mobile subscribers, a quarter of whom use smartphones, according to the report. By 2020, the number of smartphone users in the country will likely be 520 million, and the number of internet users 650 million, twice the number currently, according to the report.
+ Personal internet banking has become more popular in India over the past few years along with digital payment options that allow users to settle mobile phone, electricity and even taxi bills.
+ The recent spurt of growth has come from non-bank companies offering payment services. Cellphone companies like Airtel and Vodafone offer facilities to transfer money using phones, while “wallet” companies like One97 Communications’ Paytm unit, and MobiKwik, allow users to store money digitally and pay through their systems.
+ The next level of growth will come when local mom-and-pop grocery stores start accepting digital payments, said the report.
However, there are plenty of consumers and merchants who still feel skeptical of digital payments, or find them too complicated, said the report. And others just don’t want to give up using cash.

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Re: Is India ready to move towards Digital Economy?

Post by priyanka sharma on Sun Dec 25, 2016 11:10 pm

Yes, I think India is ready to move towards digital economy. Today when I look around I find people using swipe machine or paytm which they never thought would use in their life. The rate of using Digital media for different purposes is also increasing. After demonetization there is scarcity of paper money and that has become an change agent. When there is no paper money and they need money for their day-to-day expenditure they have to shift towards digital economy. Earlier people were not aware of the ways in which they can do payments and receive payments online but now they know ways how to do such things.

The awareness among people is rising and they are moving towards digital Economy. Changes can’t be done in a day but there is a ray of hope that Indian economy will be stronger in the days to come.

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Re: Is India ready to move towards Digital Economy?

Post by devendra sharma on Sun Dec 25, 2016 11:10 pm

Yes, According to my opinion, India is ready to move towards digital economy. The recent demonetisation has shifted whole economy into cashless economy. The focus has been on the amount of Rs 500 and Rs 1,000 currency notes that would not be deposited in banks, the broader picture stays that of squeezing cash supply in the system and ensuring that merchants and businesses keep an electronic record of all transactions making tax evasion next to impossible. it will leads to transparency in transactions as well.But talking about rural peoples or we can say some part of the economy are illiterate because they don’t know how to use wallet or pay online for any transactions from earlier times they have been using cash for transactions.

So everything has there own prons and cons so other side of this step is this move is not that much easy as we think for the government as connectivity and internet infrastructure have also been major hurdles for payments in rural area,bank does not have much cash as they have earlier before demonetisation, increase in Cyber crimes and Misuse of personal information of user.One of the major offshoots of the demonetization drive is a push towards a cashless, digital economy. The demonetization move by the Indian government would reduce the role of black money and will lead the country towards a digital economy but moving to a cashless system will take some time.So these offers attract the population to move towards the digital medium.As there is more and more use of digital medium or plastic money it will help to improve the Indian economy.

Now we can say that india is  going towards digitalization but not right now but surely in near future india will become cashless economy. bounce bounce

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Re: Is India ready to move towards Digital Economy?

Post by Megha Nagelia on Sun Dec 25, 2016 11:14 pm

The demonetisation move toward those Indian legislature might decrease the part of black money Also will lead those nation over towards a advanced economy Be that moving on a cashless framework will make a few duration of the time.
Primary benefits of India’s public sector are increased revenue; reduced costs; higher employee productivity; improved safety and security; improved environment; enhanced citizen experience, and better health and well-being.On encourage utilization of web what's more advanced transactions, the administration could think as of framing a advanced Sevak Dal – An organize for youngsters to teach furthermore help the Indian open to urban areas what's more rustic regions with move will a cashless economy.
India’s demonetization might be those push the country necessities on move with advanced banking, Anyway it will take more deliberate administration exertions should push a long haul move.

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Re: Is India ready to move towards Digital Economy?

Post by Mohish on Sun Dec 25, 2016 11:16 pm

First of all I want to thank our honorable Prime Minister Mr. Modi for Creating a digital revolution in a country like India which was not even thinking about it. India has developed its culture vastly and getting ready to accept digital culture in an economy. As before demonetization digital money was not used in such a vast manner, according to times of India around 400 to 1000% increase in digital payments and government is also taking several measures to increase digital transactions in an economy. As question is arising that is India ready for digital economy I will say a big “YES” to it because even if people have cash but they prefer more of digital money because they are getting many offers in that as well as they are comfortable with paying through digital money.

But somehow government even have to take some measures to create safe transactions so that secret information’s of account cannot be misused. Even some part of population is aware about the safety measures while making digital payments but then also more actions should be taken to create safe and secure transactions in an economy.
In the last I want to say that Digitalized economy is far better than a normal common economy.

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Re: Is India ready to move towards Digital Economy?

Post by Akansha Jain on Sun Dec 25, 2016 11:17 pm

Yes, according to me India is stepping towards a “Digital Economy”. The demonetization decisions of our Prime Minister Mr. Narendra Modi give a boost to digital economy. Apart from making India corruption free or converting black India into white, making India digitally literate is the one aim. It is the logical consequences of the demonetization process. It’s like the more cash you have in the economy the more black money it generates. So it’s another move to stop floating of black money in the economy. Government is bringing a lot of incentives for digital transaction. And digital transaction is cheaper than cash transaction. It is an opportunity for mostly young people to make India vigorously forward and turn India into a totally new India. The onward march of digital payment over cash is inevitable after demonetization. From 9th November onwards the e-wallet companies has earned the most for e.g. ‘rupeey card’ transaction has gone up by 371%, ‘UPI’ transaction gone by 268% and the company which has benefited the most is ‘PAYTM’.

But as technology has its drawbacks too, at the same time we should also consider that with the ever increasing ‘Cyber Crimes’ how do we control the data compromise and how the government will compensate the victims for the loss. And moreover we should have to build a digital infrastructure as, in India more than half of the population doesn’t have access to electricity, basic internet facility and also does not have the affordability to buy mobile phones. Only 27% of the people in India knows how to use mobile phones, so proper training platform, security is require so that we can have a hassle free “Digital Economy”.

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Re: Is India ready to move towards Digital Economy?

Post by ankitsharma on Sun Dec 25, 2016 11:19 pm

As per my opinion,The Indian government hopes its abrupt decision to remove 86 per cent of the country's currency in circulation will spur the country to a move towards a cashless economy.
While the government is urging citizens to use plastic, it appears the availability of card payment systems is currently limited to only a small fraction of the merchant network in the country. That is likely to put a dampener on consumption in the coming months and cause even more pain to small traders and consumers alike. India has been a largely a cash-dominated economy with over 95 per cent of all transactions taking place in cash.
When it comes to card payment infrastructure, India has one of the lowest number of card swiping machines or point-of-sale (POS) terminals per capita in the world, according research by EY. The penetration of POS terminals was only 693 per one million people, compared to similar emerging countries such as Brazil, which has 32,995 terminals per million people and China, which has about 4,000 terminals. And most of these card machines – about 70 per cent -- are located in the top 15 cities in India contributing to over 75 per cent of the total volumes at these terminals.
According to Mastercard, which provides payment processing products, only about 1.4 million merchant locations across India were accepting cards as of October, accounting for only about five per cent of all personal consumption expenditure in India transacted on cards, said Porush Singh, Country Corporate Officer, India and Division President, South Asia, Mastercard. That compares to about 50 to 55 per cent share that cards have in the total personal expenditure volume in developed markets, he added.

Problems :
The reasons behind the low adoption of card payment infrastructure are varied, ranging from the high-cost of the payment card machines, to a consumer preference for cash, black money, and the lack of a strong government push until now to drive cashless payments, according to Singh. That is set to change, however, with the new demonetisation move somewhat, though.
While the cost of setting up a typical POS machine varies from merchant to merchant, about half of the total cost is the price of the machine ranging between Rs 4,000 and Rs 8,000. But with more low-cost options coming to market that require only a QR code and a sticker, more merchants are likely to adopt alternative, cheaper, payment methods, experts hope.
"[POS] is expensive. It can cost between $70 to $150 but a QR code sticker is the cost of printing a paper," said Singh. Mastercard has recently launched Masterpass QR, a QR code-based mobile payments product that consumers can use to pay by both a smartphone or a feature phone. Mastercard, which has partnered with RBL Bank, hopes to expand its market share among India's untapped merchant market for more card payment products.
However, there are barriers to low-cost options as well. That is because a large number of digital payment options available on the market require a smartphone. And currently, India's smart phone penetration is only about 250 million, meaning the vast majority of the population doesn't own a smartphone and will admittedly find it difficult to jump on these digital wallets instantly. But the consumers who do have smartphones are already flocking to online wallets.
Indeed, in the past few days, mobile wallet companies have reported record sales. One mobile wallet company Paytm claims to have seen a 700 per cent jump in overall traffic and 1,000 per cent growth in the amount of money added to the Paytm accounts in the two days just after the demonetisation move to withdraw Rs 500 and Rs 1,000 notes was announced. Other mobile wallet companies like Freecharge and Mobikwik are also celebrating.

Another barrier to a mass migration to cashless is technology upgradation needed by banks and payment companies.

Just days after the currency ban was announced, many cardholders across India complained of sporadic server outages with malfunctioning credit cards machines at supermarkets and convenience stores. While none of the banks and payment companies have come forward to point to where the technical glitch lay, it became clear that the technology backbone is perhaps not as robust to support even the existing number of cards in the country. India is estimated to have issued 25.9 million credit cards and 697.2 million debit cards as of the end of July, according to data by the Reserve Bank of India.
Many other experts are also optimistic that the government will drive more people and merchants to consider digital options in the long-run. Additionally, the government's move to scrutinize large cash transactions and demanding PAN cards and IDs will only further discourage cash transactions....yes, i'm totally agree with the experts that,"In Next 2 to 3 years, India's  50% population will been using the credit/debit cards instead using the cash."

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