If we travel across India, on a single day itself, we can observe multiple instances of corruption, poverty, beggary,child labor etc. Media reports such instances throughout the day.
Poverty and malnutrition in India are still very much visible. I am not believing that all the money spending on poverty alleviation is reaching the needy.
In India, we can't say beggary is under control. Even in cities where beggary is banned,religious places, traffic joints wherever public presence is there, we can find beggars. There are even allegations that beggary in India is very much organized and is a multi crore illicit business
We have enough legislations in place to stop child labour and bonded labour. But I am not believing that child labor is abolished in India. Still we can find children working in restaurants, shops, construction sites, factories etc.There are allegations that large scale child labour deployments are going on in certain industrial segments.
Even though we have dedicated police force, flying squads and Government machinery to stop crimes, theft and robbery attempts by antisocial elements are not stopped.
"I just paid 50 bucks to that guy... was parking my bike under 'No Parking'", "Oh come on man, no need to wait here, just pay 300 to that guy and get the ticket. I can't come again to see this movie", "You know something, I paid 8 Lakhs for my teaching job and I am going to demand 25 Lakhs as dowry", "This is the last seat, pay 50000 donation now or wait till next year to admit your son in this school", "Hi dude this is original but we can't give you bill. if you go to that shop you need to pay 10000 for the handset", "Why you want bill for these ornaments? You can save 25000", "Good job man, you cooked up 50 Lakhs this year, will get you a surprise gift", "Paid 150K to that guy, he was sleeping on that file for 2 weeks". It is really painful to hear this from our fellow citizens, right?
For the last 50+ years, we have been constantly debating on these social issues. We have sorted out some of the reasons for corruption but still corruption can be observed across Government/Semi Government/Private offices/Public life. There are lot of discussions happening on this topic and so far many Indian or International researchers would have obtained PhD on this. But still we don't have a clear cut idea on how to stop it or how to fight against corruption. We have not reached any where near a corruption free society. Many ideal and responsible officers and politicians have been trying to control corruption but still it is a reality in India. Today, people can make money, out of the way for official favors or by doing illegal business. Accepting money towards bribe, donation towards 'back door' recruitment, dowry, tax evasions, cooking up corporate accounts etc are just few examples. This results accumulation of so much money inside and outside country and we call it as black money or unaccounted money.
If we can stop couple of these social troubles, many other social issues can also be resolved. For example, if everybody starts paying tax properly, Government machinery would be able to spend more money towards basic education, public health and infrastructure. Similarly if there is no provision to keep money unaccounted, people definitely will act more diligent, nobody expects bribe and the money intended to reach the needy will reach them and projects towards poverty alleviation will become successful.
Unfortunately, as of now, in our country, there are so many ways to keep money unaccounted and 100% transparent accounting is not possible. A salaried person can't evade income tax where as a street vendor making Rs.50,000 per month can evade tax. If 1000s of street vendors do this, country will loose so much money. This is not only applicable for unorganised sector, just think about any business without billing,imagine the volume of sales tax or income tax or service tax evasions.
In this context, I would like to present an idea which stops corruption and resolve plenty of other social troubles. Go for digital cash and stop printing currency
If we can stop printing currency and coins, it would be a revolutionary attempt to save our country. This can make India, free of corruption and accelerate our transition towards 'developed country' status. You might be thinking this as illogical or quite impossible. The same sort of thought process would have happened when ATMs or eBanking started by replacing traditional processes.
Today we are using debit/credit card to purchase online or offline, to transfer money etc. We are quite comfortable with that and more people are going to use this facility in the coming days. So it is achievable and the possible challenge would be to launch digital currency, country wide with special care to cater needs of rural public, illiterate people and people those who are differentially able.
To achieve corruption free India through digital cash, we may need to do all these or more
1. Make bank account mandatory for all citizens
2. Stop printing cash and coins. Digitise existing paper currency and coins like DEMAT
3. Ban buying/selling using paper currency or coins after giving enough time for digitisation
4. Make source of income mandatory to perform digitisation and in the absence of source, that money needs to be considered as black money
5. Issue cash cards (refillable) to all account holders with guidelines in regional language too
6. Convert existing ATMs as self service kiosks [ account to account or account to cash card transfers, statements etc].
7. Start more low cost self service kiosks across India which provide easy access to citizens
8. Make Registration/license and bank account with point of sale soft pay facility as mandatory to do any business/service, irrespective of scale of business.
9. Provide low cost point of sale soft pay facilities [card/cash payment] in which seller can generate a bill and customer can swipe and pay any small amount.
10. Make billing mandatory for any sale irrespective of amount.
11. Make source of money and purpose of purchase/sale in bill, mandatory if sale/purchase value exceeds certain amount.
12. Provide wireless point of sale soft pay facility to cabs/taxi/autorikshaw service and similar kind of services.
13. Provide ticket vending machine with point of sale soft pay facility to city/rural transport services
14. Ensure high level security to cash/credit card and online transactions. This need to be ensured with pin,thumb impression, retina scanner etc. Also ensure extra security levels,transaction amount wise.
15. Provide special purpose cards with adequate security measures to old aged, illiterates and differentially abled people.
If we introduce digital cash, beggary can be stopped. A person can't open a bank account for 'beggary' because end of the day, account holder should be answerable for his/her income. Also which beggar will beg with a point of sale soft pay kiosk!
Once currency is digitised, robbery can be reduced to a great extend. Somebody can rob a product for their use but they can't stole and sell it. You can't sell or buy anything without a bank account. Also remember that by digitisation of currency, RBI will be knowing the net worth of any citizen and any transaction can be tracked.
Bribing will lose its charm. How do you receive/give bribe? No cash in suitcase or in nearby shop or relative's house or secretary's car. You can't ask somebody to transfer to your account or pay your bills. All transactions and bills can be monitored and recorded. Still there is a possibility of buying a product/service and gift to another person, just to bribe that person. But there is a limit for this and the person who has accepted the gift will be in a very difficult position to dispose it off. Registration is mandatory to sell something and you will be caught if you are not a genuine seller. So you can't sell it legally but can go for Barter system!. During an IT/ investigation raid, it will not be that much easy to give reasons for all those gifts accepted. Your assets, digital cash, earnings etc should be matched at any point of time and rest of the things can be considered as illegal by Government. When everything go digital, total net worth of any citizen would be available with Government and nobody can keep crores of rupees in water tank or in caves. That game is over.
Child labor, bonded labor, employing contract/badlis by showing minimum wage only in records will be stopped. Employer can't pay employee 'something' and send them away. Salary can be paid through bank accounts only and this will make the job of Labor Inspectors and Government machinery easy. No county can ban our products with the reason that we are employing child/bonded labour.
Now you will be worried of sellers/employees in unorganized sectors? Do we really need people to be classified as unorganized?. The moment we stop hard cash, people will be forced to finish formalities [ employer, employee, seller,vendor whoever it might be]. So the person who is working as housemaid needs to open a bank account and house owner [employer] needs to pay the standard minimum wage to housemaid and nobody can exploit poverty of fellow citizen.
Sales/service/income tax calculations will be 100% correct. No tax evasions is possible because you will not be able to receive money through a secret transaction through any other channel. Bribing is out of question. Shop owners needs to keep accurate records for stock, they can't increase the price unnecessarily because bills are mandatory for all sale transactions.
There can be sharp decline on street vendors or rag pickers. I would say it is good for future of India. Do we need our kids to become school dropouts and start working in the so called unorganized sector? I would say 'No'. If we discourage odd jobs in unorganized sector, obviously more employment opportunities will be created in organized sector. Bonus would be 100% literacy, make people motivated to go for proper education and highly skilled and professional workforce.
Why should we allow street vendors to do business without any kind of registration. When somebody starts a registered business by paying rent and taxes, if a street vendor starts selling the same stuff outside shop [ may sell the product with 50% discount because, no rent & tax], we are actually discouraging organised business. To start any business, sale or service, we should make bank account, registration with government authorities[license] mandatory. If we do this, this will become another pool for revenue and obviously we can ensure standard wage to employees. This kind of businesses can use WiFi enabled soft pay kiosks.Government or banks can give financial assistance to the needy to start business and complete formalities/registration. By making billing mandatory for sale and cash transaction, 99% consumer exploitations can be avoided. Quality of products/services will be improved.
Sale of banned drugs, illicit liquor, smuggled goods, grey market stuff and sex trade can be reduced to some extend. There is a possibility that people those who are in illicit business can open bank account and register business for some other purpose and continue their illicit business but Government/other statutory bodies can easily trace the roots and find the culprits. Citizens too will change their life style. How many of us will become comfortable in swiping our cash card or credit card for payment towards buying a banned product/illicit service. The fear factor 'can be caught later with the bank transaction records' will work here.
Now you may point out another loophole that citizen can accept cash in outside country for illegal activities or corruption in India. Yes, this can happen until and unless other countries too moves completely to digital currency. When the country march against corruption united, this is not going to happen so easily and I am not thinking that to receive 10,000 rupees, somebody will open an account in Switzerland. End of the day they need to go out of country to spend that money because they can't transfer that money to India. RBI can crack it.
Another possible good outcome through digital cash would be abolition of existing black money in country. Banks can reject digitization of cash if the source of income is not provided or not genuine. Sale/Transfer of assets too can be blocked [because you can't simply accept cash, need to provide bank account!]
Billions worth black money can we wiped away and this will discourage people to crave for that sort of money. People will invest money in business in an organized manner and business environment will become more professional. Once country's economy is improved, definitely more investment can be attracted and this in tern will improve our infrastructure, standard of living and overall economy itself.
Even if other countries are not willing to abolish hard cash, it is not going to affect us. The moment a foreigner or NRI lands airport, facilities can be provided to convert the foreign currency to to digital cash in card. Similarly Indians when travels abroad, can make use of the cash card to draw foreign currency.
By abolishing hard cash, jobs associated with currency printing, cash handling in organisations /banks, cash collection etc. can become redundant. But the growth in organised sector will create more jobs and redeployment would be pretty easy. Also when we make Bank account as mandatory for a citizen, more than 100 crores bank accounts needs to be maintained and this will create more employment opportunities. The money spending to provide high level security to print,store and circulate cash can be saved. No need to worry on fake currency and black money.
End of the day, common public will criticise bureaucrats or politicians for all sorts of social troubles. But can we point our fingures to politicians or bureaucrats for all these troubles?. I would say 'No', we are all responsible for best and worst in our country. We need to act. We should be able to do social campaigning for the development of India and eventually a social opinion should be evolved.
What do you think about this concept? Feel free to share your feedback.
Disclaimer :- Kindly note that this is expression of an idea based on beliefs and perception of author. Media reports, day to day observations, scams in public life, personal experiences etc would have been influenced that. This is visualisation of a solution and possibilities of technology and not based on any research, statistical analysis or authentic studies.