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The End of Physical Cash: Will Money Go Fully Digital?
Cash is slowly becoming obsolete for younger people and those living in urban areas, with some going for months without ever seeing paper money. However, for others, cash is still the only viable option. In this article, we will explore what the future holds for money.
After the demonetisation of 2016, digital transactions in India have grown significantly. This event marked the start of the digital era. Additionally, the Indian government's flagship programme, Digital India, aims to turn the country into a digitally advanced society and knowledge economy. One of the main objectives of Digital India is to become faceless, paperless, and cashless.
The COVID-19 pandemic has accelerated the transition towards cashless transactions. People now prefer to use online payment methods to avoid close physical contact in stores. This trend has made it possible to make instant payments from anywhere in the world, something that was not possible with physical cash.
Despite the increasing use of digital transactions, cash still holds an emotional and practical value in many aspects of our lives. For instance, cash is still used in Indian festivals, as it is considered an essential part of gifting. Cash is also preferred when giving tips, making small donations at temples or expressing love towards grandchildren. In addition, cash provides a level of privacy as it is untraceable, making it useful for buying things without leaving a digital trail. Cash can also serve as an emergency fund in areas with weak internet or cellular network coverage. Additionally, for those who are economically disadvantaged, cash is still a medium of exchange. While digital transactions are becoming more popular, cash still plays an important role in many aspects of our lives.
The increase in the use of digital methods for paying money.
Many businesses, such as shops, cafes, and restaurants, are no longer accepting cash payments. Some online stores are also moving away from allowing customers to pay cash on delivery. Banks are using advanced technology to make transactions seamless and keep customer data secure. Many banking processes and paperwork are now done online, such as opening accounts, transferring money, paying bills, booking flights, and paying insurance premiums. India has become the second largest online market in the world, with over 560 million internet users. In 2021, India had 48 billion real-time transactions globally, with 80% of these transactions coming from cities beyond the first tier cities.
