THE NEW MANTRA -- DIGITISATION !

DIGITISATION -- this is the new Mantra  in India  after demonetisation. Some  describe it as "going cashless."  It simply means  one   should increasingly  use  credit  and  debit cards,  write out  cheques, opt for e-wallets and choose other electronic money transfer options in financial transactions, refraining from flaunting cash. What is outstandingly remarkable is that it is being advocated and promoted on a war-footing by state as well as non-state players, despite virulent protests in some quarters. Newspaper advertisements, emails from banks and messages from wallet promoters are exhorting people day in and day out to go in for it.

FACTS, FIGURES AND FALLOUT

(A compilation by Subbaram Danda)

  

The backdrop

At present Sweden has a near cashless economy.  Its people use electronic modes for almost all of their transactions. Next comes Denmark, followed by Belgium. Interestingly, Somalia and Kenya are also in the race. 

India currently accounts for 2.64 crore “outstanding” credit cards issued by the entire banking system, according to Reserve Bank of India statistics.  Of these, HDFC Bank leads the pack with 79.6 lakh cards. 

What is interesting is that the number of debit cards in circulation is significantly far more than the credit cards—many, many more times.    They total 71.24 crores!   Of course, some people hold multiple credit and debit cards.  This should be seen against the current population of the country, which stands at 127 crores.

More fascinating is the emergence of e-wallets in India in recent years.  The cashless drive has given them a shot in the arm.   They have registered phenomenal progress in recent weeks. Currently, more than a score of e-wallets are on the forefront.  They are run mostly by private organizations, banks and mobile phone operators.    

Yet, the process of digitisation bristles with challenges.  Now, as many as 95 crore Indians or over three-fourths of the population do not have access to the internet, which is necessary for several digital operations.  This is revealed in a study made by Assocham and Deloitte.  However, the silver lining is that mobile data plans in India are among the cheapest in the world and the average retail price of the smartphone is falling fast.  

(The statistics in the diagram pertain to credit cards.
Picture courtesy: "The Times of India")

Comments

Former Union Finance Minister P. Chidambaram: “Cashless India is an illusion. It is a distracting mirage.  It may not even be a desirable goal.”

Union Finance Minister Arun Jaitley:  “Digital payments constitute a parallel mechanism, but not a total substitute for cash transactions.   The Centre is trying to encourage digitisation because an excessively cash-dependent economy has its social and economic costs and consequences.”

“The Hindu BusinessLine” in an editorial:  “The Centre’s push to promote digital payment is a welcome move…. (But at the same time) the threat of cyber attacks — by both state and non-state actors — is a reality the Government needs to acknowledge even as it aggressively pushes digital payments over various platforms.” 

 “The Times of India” in an editorial: “To curb black money at its root, make all political funding cashless and digital.”

Columnist Amit Varma in “The Times of India”: “A cashless society would be a disaster for India. It would mean end of privacy and end of dissent…  It endangers freedom... It is a myth that an advanced society must necessarily be cashless.  Even in the US, 45% of transactions are in cash.” 

Former Chairman of the Central Board of Direct Taxes Sudhir Chandra in a report in "The Hindu":  "Those who are above the age of 50 don't have the propensity to pay by cards.  They normally pay even restaurant bills by cash...."

Allurements

Private and public sector players are on an overdrive offering a plethora of incentives, concessions and inducements to people in a bid to encourage them to switch over to electronic modes of payment.  Sample the following:

ICICI Bank is drawing the attention of its customers to its special “Expressions Debit Card.”  Printed on it will be a photo of them reflecting any precious moment in their life so that they can re-live it at every use of the card.  

In a full front-page newspaper advertisement, a leading e-wallet company FreeCharge has highlighted one of its unique features: “Even if your phone is lost, your FreeCharge wallet balance is safe…  It is now insured upto Rs.20,000.”

A leading durable consumer goods firm has invited its customers to make year-end purchases without hassles.  It said in an advertisement, “No cash, no worries and no service charges.   Select (your product) and swipe.”

Canara Bank has come up with pre-paid cards of a new kind.  It is issuing two types of cards charged with limits of Rs.500 and Rs.1,000.  Every KYC-compliant Savings Bank account holder can receive five cards, which can be used by him, his family members or associates.   They can be swiped at any shop like the credit and debit cards.  Once the amount in any card gets exhausted it can be recharged.  The greatest advantage is that if it is lost, the burden of loss will not be heavy.  It has a wider plan for corporate account holders.  

In lighter vein

Though digitisation is not as glamorous and colourful as demonetisation, it has generated its own moments of hilarity.  Some of its comical outbursts are thought-provoking too!  

Cartoon

Here is a cartoon that appeared in the “Deccan Chronicle,” following an official offer of a variety of incentives and prizes for people taking to digitisation more and more.

Joke 1

Members of the All India Pickpockets Association are highly frustrated.  They have called for a rally in front of the Finance Minister’s residence to protest against the cashless India campaign.  Reason:  it seriously undermines their birth right to earn their livelihood.

Joke 2

Vijay’s newspaper supplier hands him the monthly bill and asks for payment in cash.  Somewhat upset, Vijay, a vociferous advocate of technology, gives a long lecture on the virtues of keeping abreast of times and advises the supplier to go cashless in tune with the times.   Unfazed, the supplier replies with a broad smile on his face, “Sir, that is all perfectly okay.  But, you still read a newspaper, no?”

Joke 3

A report: The 5,000-strong Greater Chennai Beggars’ Conglomerate has urged the Union Government to supply to every one of its members a swipe machine free of cost, as they are in no mood to go out of business in view of the current cashless drive.

Joke 4

The Prime Minister:  “Go cashless.”

Several bank ATMS seem to have taken the diktat literally.  They have gone “cashless.”

Joke 5

“Who are the first people to welcome digitisation?”

“Those with Diabetes!”

“Why?”

“They know the value of a bitter bill.”

  

Punch dialogues

Newspaper advertisements have been churning out catchy texts to attract readers.  Here are some of their creations:

“Why pay in cash?  You can now pay in a flash.”

“Live more, bank less.”

“It is now electronic economy.”

“White is right.”

“Get cash worries out of your sight, as we make your bill light.”

Novel effort

An individual has come up with an imaginative idea to promote digitisation, as reported in a news channel.

An onion trader in Coimbatore, he has designed an invitation for the wedding of his daughter in the size and shape of an ATM card with all the details printed in English and Tamil!  He says with a touch of pride, “My idea is to encourage people to go in for digitisation.  The Prime Minister’s initiative is a bold one, which all citizens should support.”

The impact

The cashless initiative has produced some dramatic and swift changes in the financial scene of the country. 

Daman and Die, the tiny Union Territory along the Arabian Sea coast has become the first cashless region of India, according to a report of the Press Trust of India.  This follows the tireless efforts of at least 190 teams of trained volunteers visiting over 25,000 households spread across the UT to educate their members about the benefits of cashless transactions. 

PayTM, the most visible e-wallet company, has added over 2 crore new users in 40 days post-demonetisation, taking its total user base to 17 crore.  It is reportedly clocking over 70 lakh transactions a day.

Several grocery stores, which were hitherto accepting credit cards only for bills over Rs.1,000 have now put up notices that their customers are welcome to tender plastic money for transactions as low as Rs.200.  One famous restaurant chain in Chennai has started accepting cards even for Rs.100.  Interestingly, temporary canteens put up in the premises of halls hosting music and dance programmes during the annual fine arts festival in Chennai too have swipe machines. 

India’s biggest milk and milk product producer Amul has opened 5.4 lakh savings bank accounts across the country for its suppliers.  The idea is to remit money due to them into their accounts avoiding cash payments. This is considered “not only a revolutionary step but also a big push” to PM’s digital India initiative.

The road ahead of digitisation is long and daunting.  But the destination is full of promise.

December 30, 2016

OH! DEMONETISATION !!

It had all the trappings of a surgical strike – secrecy, surprise and swiftness.  Prime Minister Narendra Modi’s November 8, 2016 attack on black money hoarders, terror operatives and fake currency churners through demonetisation of Rs.1,000 and Rs.500 currency notes and introduction of new Rs.2,000 notes was undoubtedly a well-orchestrated manoeuvre. 

 

It is not my intention here to go into the merits or demerits of the move. Instead, I want to capture the “fascinating” ripples it has generated. Newspapers, magazines and television channels have been flush with interesting stories.  There has been a flurry of activity in the social media like the Face Book, Twitter and WhatsApp.  The result is a treasure trove of humorous skits, awesome photos, uproarious trolls, thought-provoking cartoons, fact packs, ingenious comments and poetic interludes. 

  

It is my pleasure to present here some such “never to forget” pieces of intellectual flourish.  Who said our people are not thoughtful?

SCENES, SOUNDS AND SCENTS

(A compilation by Subbaram Danda)

The determined warrior

The Prime Minister hit the cover page of the popular Tamil weekly “Kumudam” in a rare style.  He was featured sporting the full battle armour.  It was a rehash of the picture of Bahubali, the principal character in the blockbuster movie of the same name.  The word Bahubali running across the photo was modified to read Black-bali, conveying in unequivocal terms that he is all set to inflict a deadly blow on black money. 

Bouquets

News channels repeatedly telecast a scene in a busy branch of the State Bank of India, where an out-of-the-way human emotion was at play.   An elderly woman was seen presenting flowers to staffers there in appreciation of their commendable work under great stress.  They were pleasantly surprised.   

The workload  of the bank staff also became the subject of a meme.  

Trolls

Historical anecdotes came in handy for people to look at the new situation.

Marie Antoinette was the queen of France at the outbreak of the French Revolution more than two centuries ago.  Her extravagant lifestyle had made her very unpopular with the French citizens.  Her infamous poser to starving revolutionaries was: “If you don’t have bread, eat cakes.”

In an imitation, Modi was presented in a meme as advising people: "If you don't have paper, use plastic."  (The reference is to his suggestion that people should increasingly go in for electronic payment options like credit cards.)

Tell-tale photos

The social media was full of photos that reflected the trend of the day in more ways than one. Here are a few of them.

The first child has no demonetised currencies - so looks cheerful.
The second knows not how to exchange - so looks moody.
The third has converted his old notes - so is all smiles.

In step with times:  "We welcome your presentations.
We have swipe machines." 

The magnitude

The fight against black money has unfolded mind-blowing statistics about currency notes. India is the largest producer and consumer of currency notes in the world after China.  According to reports, more than 9,000 crore notes of all denominations have been in circulation.   Of these 2,300 crore notes represent the scrapped denominations of Rs.500 and Rs.1,000.

Visualise this scenario:  A pile of the 2,300 crore demonetized notes stacked one on top of the other would rise to a height 300 times that of Mount Everest, the highest peak in the world.  If laid as a pathway to the moon, it would be long enough to enable a man to go to the moon and come back five times.

What will the Reserve Bank of India do with the huge stock of the unwanted notes?  They will be shredded into tiny pieces in powerful machines, compressed and converted into briquettes.  These will be sold to industries for use in furnaces as fuel.  They also serve as landfills.  Further, the shredded material can be made into pulp and used to make boards, pads, files and calendars.  

In the past

The first demonetisation of independent India took place in 1978, when Morarji Desai was the Prime Minister.  Currency notes of the denomination of Rs.1,000, Rs.5,000 and Rs.10,000 were declared invalid.  At that time they were really of high value.  

In lighter vein

The long queues witnessed in front of banks for deposit of the banned notes or their exchange for legal tender provided fuel for thought for comic writers.   Here are some of the several jokes that went viral on WhatsApp:

Joke 1

Two friends met after a very long time.  They exchanged pleasantries and started discussing their family matters.

Friend 1:  So, how many children have you?  They should be well grown up now, no?

Friend 2:  Sure, I have three children, all sons aged 26, 23, and 20.

Friend 1: What are they doing now?

Friend 2: The first is married.  He and my daughter-in-law are in Canara Bank, the second son is in Central Bank and the third one in Indian Bank.

Friend 1: Oh, that is wonderful.  All are employed in the banking sector! 

Friend 2: No, no, they are all now standing in a queue to convert demonetized currencies into legal tender.

Joke 2

A suggestion: Before visiting the bank to exchange your old Rs.1,000 and Rs.500 notes, please don’t forget to carry the following:

1. Your ID proof, 2. Lunch box, 3. Playing cards, 4. Dinner packet, 5. Bed sheet, 6. Pillow, 7. Blanket, 8. Mobile power bank, 9. Drinking water and 10. Lots of patience.

Joke 3

The situation one day after demonetisation:

ATMs – out of service

Banks – out of cash

People – out of control

Modi – out of India (shortly after demonetization announcement Modi went to Japan on a pre-scheduled official tour)

Joke 4

An unsolicited advice: You can take your old notes to public sector banks, private ones or the banks of the Ganga, the Yamuna, the Narmada, the Godavari or the Cauvery.  Your decision should be based on the colour of your money.

Joke 5

Husband: Why is Pulav tasting somewhat different today?

Wife: I have no small currency to buy Lavang, Pudina and salt from the local shop.  So I added a small quantity of the Pathanjali tooth paste, which has all these three ingredients!

Joke 6

“My wife is treating me like the new Rs.2,000 currency note”.

“Lucky guy.  She adores you.”

“Oh no, she feels that like the high-denomination note she cannot change me, nor can she get rid of me.”

Joke 7

A tongue-in-cheek reminder to citizens of India:  If you send your pants and shirts to laundry without taking out any currency in the pockets, you may be charged with money laundering, a serious offence under the regulations.



Joke 8

Banks have a new task on hand.  Pressure is mounting on them to be KYE-compliant (Know your employee) rather than KYC (Know your customer).  This is in view of the numerous note-conversion scams involving their employees.  

Cartoons

There have been a variety of cartoons in the media.  Here is a sample.

The fallout

The demonetisation step saw strange developments.

A man living on the outskirts of New Delhi went to his bank to withdraw Rs.20,000 from his savings account, but the bank had run short of notes.  He agreed to receive Rs.10-coins instead.  He collected 2,000 coins in a sack and carried the heavy bag all the way back home.  It weighed 16 kg.

A gang of burglars broke into a bank in Uttar Pradesh in the night.  They could not locate any currency that was legal tender.  There were only bundles and bundles of demonetized notes. There were, however, Rs.10-coins neatly packed in plastic bags. They were clever. They executed the robbery in a smart fashion.  They carried away only the coins worth Rs.1 lakh. The Police wondered how they could have transported the heavy booty.

A young man, employed as a computer engineer, stood in a queue to exchange his old currency for new.  The line was very long and to kill the time he struck a conversation with a lass, who was also in the line.   They were not successful in converting their money that day.  They came again the next morning.  Their friendship took an intimate turn, as cupid showered his arrows on them.  They decided to marry -- but only after the demonetization fever subsided. 

In Kerala, official information shows that liquor sales did dip after demonetisation, but bounced back within three to four days. 

Comments

The reactions were winsome.  Not only were they outright critical or stubbornly supportive but also sarcastically rhetoric or patently witty.  Here are some:

Former Prime Minister Manmohan Singh: “It is monumental mismanagement...organized loot and legalized plunder.”

Congress Vice-President Rahul Gandhi: "It is Modi-made disaster."

Finance Minister Arun Jaitley: “It is a courageous step...  Parties, who were once a part of every scandal in the country, are now opposing demonetisation.”

A former Union Finance Minister:  “It is demonisation, not demonetisation.”

A famous cricketer:  “I don’t have to go to a bank.  I have piled up many 100s.”

An edit-page piece in the “Times of India”: “The PM’s surgical strike…might whiten the economy; for now it has only blackened our mood.”

A “status” on FaceBook: “Amazed at the lies being spread, I went to my bank. No crowd, no jostling, no stampede, no lost tempers, no police and no cash.”

A caption to a photo in a write-up of newspaper columnist Shobhaa De: "After standing for hours in ATM queues, the aam aadmi (common man) is now being told to stand up and take a patriotism test in cinema halls."  (This is in the context of the Supreme Court's directive to cinema halls to play the national anthem before screening a movie.)

Poetic outbreak

A video clip has emerged on You Tube that goes lyrical about the old 500-rupee note.  Titled “An Ode to 500 Note,” the short flick features a young woman singing tunefully, “Here is an ode to my old 500 note that bought me many things I like to sing about……”  It is indeed an imaginative creation.

And we can expect more of these in the days and months to come!

November 28, 2016