There is a discernable narrative shift of the Government from the war on black money to the proposal that purports to take India into a cashless economy. Some can see the coming of the cashless economy as a natural logical step to demonetization. Others view conspiracy and deem demonetization as a political decision and not an economic one. They hold among other things that it was made to create a less-cash condition that would naturally push most people to the digital economic ecosystem to favour the digital tycoons. In a bid to become the first state to usher in a cashless economy, the BJP Government has issued a circular on commercial tax in Goa and ordered all traders in Goa to join the digital ecosystem by 31st Dec 2016. Some have already challenged the authority of a Government department in the court to issue such a circular. But the Government seem to be in no mood to listen to the people. There are reports that the education of the people to inhabit the cash-free ecosystem has already begun. Details are not yet clear. Voices of dissent can also be heard in the ranks of BJP itself. Amidst all this, the Government is said to have issued a code *99 # which can be used by everyone to buy anything in Goa through the online banking system. Several Goans opine that a cashless ecosystem is not practical in Goa at least for now. Perhaps, a profound understanding of what a digital economy means and what it will do to us will assist us to respond to what is being hurriedly pursued as the ultimate solution to all our ailments. Maybe we will have to push the cashless policy to its fullest potential (at least theoretically)and assess its pros and cons.
The great evolutionary leaps of computational technologies have reduced banking transactions to a touch on the screen of a smartphone. This brave new world has led our Government to imagine a cashless policy for our society. There are several advantages of a cashless ecosystem. But pushed to its ultimate limits, it threatens to bring about the elimination of all mediatory structures and agencies. Thus, for instance, the cashless economy being digital will remain online and will make banks that are territorial ultimately irrelevant. In a scenario when all would access online banking services, it is not just banks that will be obsolete but most middle persons or service providers will become defunct. The Government appears to be a major beneficiary of this cashless policy as all our taxes would be directly deducted along with our transactions and will smoothly move straight to their assigned destinations (the state and central treasuries). Besides, the very nature of online transactions will enable the Government to keep a watch on every detail of our financial activity. While the surveillance of the Government may appear to be invasive and even indecent yet there are several benefits that cannot be overlooked. If we have the ideal e-security ecosystem and state of the art digital infrastructure, every Rupee will surgically reach the destination that we have deemed it to go.
Along with its numerous strengths, there are several problems and vulnerabilities. The cashless economy will open space for e-commerce and distance mode of buying and selling in a big way. The fact that all cash transactions will cease to be functional, the middlemen between the point of production and point of sale/delivery will have to go. This direct access to the concerned products has to certainly bring down the prices and check inflation but paradoxically, the e-environment being homogenous and seamlessly invisible may not be entirely free from leading to the generation of monopolies that would ultimately reduce/ delete all services of the middlemen as well as become breeding ground for inflation to thrive. This means the e-environment with its cashless transactions will eventually drop all agencies that provide mediatory services, like shop-keeps, milkmen, bread-men, fish-woman etc., on the roadside. In the long run, we are heading to a Flipkart-like world. Although the consumer might get home deliveries at the click of a button, as the market will also come onto the screen of a smartphone, there would be a sizable section of service providers that will be hit hard by the digital move. Initially, we will still have the shopkeeper and other service providers, but the e-ecosystem being fundamentally anti-middle-man, it will in the long term replace every form of mediation that is animating our society today. A cashless economy is tailor-made for huge corporate service providers who have already invaded the retail chain in our country.
No cashless service comes for free. The customers who use direct cash payments do not have to pay any service surcharge and inter-net tariffs. But the cashless payments will come along with these burdens. Besides, there are always dangers of one’s account being hacked. Unless we have a good e-secure ecosystem, we cannot insulate ourselves from the grave dangers of being cheated. Besides, digital illiteracy becomes a digital divide that cannot be bridged so easily. Moreover, a cashless economy requires a good digital infrastructure to back it. This infrastructure cannot be seemly reduced to the number of people connected to the mobile phones but also has to consider the kind of network connectivity that exists as well as processing abilities of the phones that people use. Hence, the assessment of losses and gains of the proposed leap into a cashless policy in Goa has to be carefully done. Goa, being a tourist state, the cashless policy will not only affect the people of Goa but also afflict the tourists that visit the state. Besides, the large section of old people who are not digi-friendly will have difficulties migrating into the digital world. The daily waged labourers, the milkmen, the newspaper vendors, the bread-men, the fish-woman, maids, housewives, car drivers, bus conductors and a host of other service providers will suffer the most. Besides, the decision appears to be autocratic and undemocratic. With the people of Goa and other stakeholders not being consulted for a change that will affect most aspects of their daily life, the decision to make Goa cashless is yet another instance, of our society being afflicted by the institutionalisation of totalitarianism of the right.