Imagine living in a world where you need cash to buy virtually everything — from food to clothes to a new home. Yet you have no cash. The best you can do is stand in line at the bank for hours in the hope of withdrawing a small amount of paper money. The unintended consequence has been a serious cash crunch shortage that’s caused upheaval across the land. India, the world’s fastest growing economy, is stuck in neutral: Queuing in line for money has become a ritual. Wholesalers and retailers have stalled. Everything, from real estate deals to weddings to surgery, is on hold.”
“Paper money is scarce as a result of a government edict. But a couple of major obstacles stand in the way of the cashless society.”
The policy-makers pushing a cashless society are “essentially putting the cart before the horse. The country needs to invest in its digital infrastructure before it pushes people to digital payments. The Pew Trust survey also found that just over a fifth of Indians have access to the internet, with many more men online than women. “If you think about the fact that women are … primarily responsible for making household purchases,” Chakrovorti says, “how can one expect digital payments to penetrate in a meaningful way when only 17 percent of women have access to the internet?