Digitalpayment would help in a great way for all the transactions to become legal, whichin turn will enable the government to have control over corruption and fakemoney. Digital mode of payment will put an end to the tendency of people tocarry out secret transaction of higher amount.
One of the positive impacts of digitalization isthe increase in the number of tax payers. Because in digitalization alltransactions have to be done through banking so the government body can easilymake out one’s income and the expenditure. Afterdemonetization, there has been a growth on digital modes of payment. At the same time Government ofIndia and Reserve Bank of India took certain measures such as reduction in themerchant discount rate, broadening prepaid payment instrument, permitting banksto issue PPIs to larger set of entities etc. (Macro-economic impact ofdemonetization). Mobile based digital payment is growing world wide. TheScandinavian Nations, Norway Sweden, and Denmark as well as UK, France andBelgium are well on their way to becoming entirely cashless.
Thereare certain factors which are very urgently considered in India when it goesfor the digital mode of payment. The first one is the internet connectivity forthe entire country. It is true that some of the interior parts of India stilldo not have electricity and internet facility. In the absence of suchfacilities, the online transaction will never become a reality for them. Thesecond one is with regard to the security. Reports of credit cards being hackedinto have raised fear in people of losing their entire bank savings.
For thisthere should be strict government guidelines on security which can reassure theconfidence of the people. Banking and financial products should reach themasses to ensure financial inclusion. By reduction in cash transaction andencouraging e-payment system, we can achieve the real objective of economicgrowth and financial inclusion. Even in e-commerce transaction, cash ondelivery is the norm and people prefer it, because of the guarantee.