How PM Modi transformed India into Cashless Economy by Currency Demonetization?

Introduction:

India population is 1.4 Billion (140 Crore) and Internet Penetration is 48%. Around 67 Crore people are corrected internet.

According to a latest report, the market share of UPI has increased from 2% in 2016-17 to 52% per cent in 2021-22. Around 34 Crore people are using UPI and digital payments.

India Population : 1.4 Billion (140 Crore)

Internet Penetration : 48% (67 Crore)

People Using UPI : 52% (34 Crore)

Disadvantage of Cash Money:

Increase in Black Money:

1. In India, in small cities still people doing all the transactions in Cash. This is increasing Black Money because all the vendors take all the money as cash but they never deposit that all money into their Bank Account. So, this money is never comes into Bank and becomes untraceable.
2. There are a lot of vendors like Momo seller or sweets seller and other shops which doesn't even have a Credit Card Machine. Here people gives cash to vendors and most of the times don't even take receipts of bill. If vendors keeps this all cash money into his home, it's all goes into Black Money.
3. When we visit a small sweet shop he always takes all the money as cash. Some Sweet shop are running so nicely that they do 10k business daily but they collect all money as Cash.

Inconvenience:

1. When people are dealing with cash, it's always an inconvenience to find small currency denomination and many a times people are running here and there for change of money. This creates a huge inconvenience to people.
2. Cash also create issues in storing the cash if it's in huge amount.

Waste of Government Money in Printing Currency:

The more cash people will use, the more currency government have to print. This is really a huge waste of tax payers money in printing the cash.

Advantage of Cashless Economy:

Reduce in Black Money:

1. If people are using UPI and Digital Payments at vendor for paying their daily expenses, money will be directly transferred to vendor's Bank Account. All the money can be easily traced in Bank Account. 
2. If vendor is earning more than 5-6 lacs yearly, government can easily track them and vendor have to pay income tax. This will reduce the Black Money.

Convenience:

When people are using UPI and digital payments for their daily payments, they don't have to carry cash always with them. 

Job Creation:

Since people have started using UPI and digital payments, a lot of UPI Companies have been started which gives user interface to transfer money from UPI and digital payments.

This has created around 100-200K Jobs in Indian Market. 

1. Google Pay
2. PhonePe
3. Paytm
4. Amazon Pay
5. Airtel Payments Bank
6. MobiKwik
7. Samsung Pay
8. WhatsApp Pay
9. BHIM

How to make Cashless Economy?

1. Government must do currency demonetization in every 3-4 Years so that people make a habit of using UPI and PayTM as much as possible.
2. Government must provide financial grants to those Startup which provide people to use UPI and digital payments.
3. The more and more people use Digital Payments and UPI, it will reduce Black Money and bring more people under Tax regime.
4. We must reduce printed currency, Automatically people have to use digital money transfer.

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