Airo International Research Journal March, 2017 Volume IX, ISSN: 2320-3714

CASHLESS TRANSITION A CASE STUDY ON DHASAI VILLAGE OF MAHARASHTRA

G. PREETHI (M.COM), LECTURER IN Dept. of Commerce, St.Pious X Degree P.G.College for women, Nacharam, Hyderabad. Ph.no.8897024098, Email id: [email protected]

ABSTRACT A tiny village Dhasai, some 70 km from Thane, and around 140 km from Mumbai, has become Maharashtra's first “cashless village” On 1 December 2016 in India; All payments in the village are being done through plastic money.Traders, vegetable and fruit vendors and others providing goods and services in Dhasai are using swipe machines for cashless transactions.It may be recalled that Prime Minister Narendra Modi has taken step to check corruption and terror funding by banning old ₹500 and. 1,000 notes.Dhasai, in Murbad taluka, around 70 km from Mumbai, has a population of around 10,000. Around 60 nearby small villages depend on Dhasai for trade and their daily needs.The main purpose of this paper to bring awarenessamong the people about digital payment of transaction. So many methods to do transaction withoutcarrying cashNet banking ,Gift/Forex Cards, Digital Wallets,Credit card,Aadhar Enabled Payment System.The data collected from secondary method information is collected from journals and different web sites. Dhasai village model has proved the people, banks and traders are ready for the transition. All they need is a bridge to connect them.Farmers are poor, but they are not fools. They have debit cards and use them but not only to withdraw money from ATMs. The traders are doing transactions on cares farmers are happy to become a cash less. It is an example that a determined common man can adapt to the situation. this survey about the likely future of the Internet, a majority of technology experts and stakeholders expressed confidence that by 2020 most people will have embraced and fully adopted the use of smart-device swiping for purchases they make, nearly eliminating the need for cash or Airo International Research Journal March, 2017 Volume IX, ISSN: 2320-3714

credit cards.The choice of digital payment will be made by the corporations who will increase their profits by eliminating all cash. When a small village can be a cash less why can‟t a whole country. Keywords: Dhasai, digital payment, Cashless transaction.

INTRODUCTION: Bank of Baroda in collaboration with A Cash less economy is one in which all NGO Veer Sarkarratishthan. The NGO the transactions are done using cards or trained the villagers in using digital digital means. The circulation of methods of transactions, the minister physical currency is minimal. India uses said.Mungantiwar, who attended a too much cash transactions. The ratio is programme in Dhasai with General cash to gross domestic product is one of Manager of Bank of Baroda Navtej the highest in the world. -12.42% in Singh, RandheerSavarkar of Veer 2014 compared with 9.47% in china or SavarkarPratishthan, MLA 4% in brazil. Less than 5% of all KisanKathore and others used his debit payments happen electronically. The card to purchase rice, marking number of currency notes in circulation beginning of cashless transactions in the is also far higher than in other large village. Due to demonitization the economies. India had 76.47 billion situation in the village got worse. No currency notes in circulationin 2012- one had cash in hand and all business 2013 compared with 34.5 billion in the were conducted only on credit. US. Some studies show that cash However, there's a limit to which a dominates even in malls which are business can function on credit. Barbers visited by people who are likely to have had to cut their customers' hair on credit cards, so it is no surprise that cash credit; groceries were sold on credit; dominates in other markets. Prime chicken, meat and medicines were Minister Narendra Modi has taken a bought on credit; seeds and fertilizers revolutionary step to check corruption were bought and sold on credit. and terror funding by banning Objectives: old Rs. 500 and Rs. 1,000 notes. He has  To bring awareness about cash less shown us a dream and has taken steps transaction. for cash less economy.In this journey, Dhasai has emerged as the first cashless  To study the strategy of dhasai village village in the state. " he said.Dhasai, in as cash less economy. Murbad taluka, around 70 km from  To analyze the issuesof digital payment Mumbai, has a population of around in India. 10,000. Around 60 nearby small  To overcome the challenges of digital villages depend on Dhasai for trade and their daily needs”. The initiative to transaction. make this village cashless was taken by Research Methodology: Airo International Research Journal March, 2017 Volume IX, ISSN: 2320-3714

In this paper an attempt is made to the country. All our need is an internet know that how dhasaivillage become a connection, a username and a password first cashless transaction in India. Due to log in to your net banking website – to demonetization, many people and. With the help of net banking, we suffered for daily transactions. And can check our account balance, mainly concentrated how to statements, we can pay our credit cards overcomeproblems of digital bills, electricity bills, do a wi-fi transactions in India. And what are the recharge…we can even recharge a various ways chosen by dhasai village mobile or any prepaid connections. It to get their daily needs without money when big note Rs.500 and Rs.1000 are allows us to do third party payment eliminated. All farmers and other transfer. From net banking, we can also members how they trained to become a apply for a loan. Purchase of mutual cashless. The study is mainly based on funds, insurance can also be executed secondary. The data collected from through net banking. It is a very secure various journals, books and mode of carrying out multiple officialwebsites and articles. transactions. It comes with a range of transaction options such as IMPS, NEFT, RTGS. 2) Credit Card: The credit card saves our time as there is no need to go to 10 easy ways to go for cashless transactions banks or ATMs. And only need to Credit cards, debit cards, meal cards all swipe the card through a machine which carry a certain purchase limit and can be shopkeepers and grocery stores used easily at many shopping centres normally keep the days. On every and stores. With the Modi government purchase made through credit cards, we demonetising old Rs 500 &Rs 1000 get reward points which again can be banknotes, more people are being used for the purchase of other compelled to move towards cashless products.Credit is the grace period transactions. So, how does one go given by the banks for paying up the cashless? Here are some options bill. we normally get a credit limit based 1) Net banking: It allows to use on our income level, but that also banking services from any place across depends on certain factors such as our Airo International Research Journal March, 2017 Volume IX, ISSN: 2320-3714

past credit score, stable job, liabilities cards are reloadable but they are against any loan taken and various other reloaded only when the amount is either payment dues. Some merchant outlets consumed or gets expired. we can may charge up to 2.5% extra if credit request for this prepaid card through our card is used. net banking by going into the card 3) Debit Cards: They are just like section and selecting the option of credit cards, without the „credit‟ „request for prepaid cards‟ and with few element. Whenever weneed money, this verifications, we will get the card at our card will provide you cash 24×7 doorstep. through any ATM machine. There is no 5) Digital Wallets: Instead of keeping need to worry about bank timings, stand money in the pocket, purse or physical in queues for withdrawing cash – wallet, we can keep money in e-wallets. leaving out special circumstances like These e-wallets are like our physical the one we are seeing right now. These wallets which we keep in our pocket. It are bank account-linked ATM cards, is a mobile based application which can that are mainly used for withdrawing be downloaded from any app store and cash. As soon as the cash is taken out can be accessed through our mobile from an ATM machine, by swiping phone. Transaction or transfer of funds your card, the amount gets deducted through these wallets can be done from your bank account. An instant across the country between person to message is sent to registered mobile person. The only thing we need to do is phone provided the details of cash to reload our wallet any time by withdrawal. These are widely accepted transferring money into it through our cards. Debit cards can be used for bank account. These wallets are highly online transactions and at merchant encrypted, so, there is no need to worry outlets. about security. Currently, e-wallets are 4) Gift/Forex Cards: These are prepaid offered by PayTm, Mobikwik, Free cards which have certain cash limit charge, Reliance Money, etc. Even assigned to them. These are readily banks like SBI, HDFC Bank, AXIS, accepted cards and can be used at any ICICI Bank, etc. have launched their e- shop and can also be used for online wallets app viz a viz Buddy, Payzapp, purchase of products. Most of these Lime, Pocket respectively. Airo International Research Journal March, 2017 Volume IX, ISSN: 2320-3714

6) UPI (Unified Payment Interface): groupings, nearby coupons, shopping Simply put, it enables to transfer money site coupons, etc. from one bank account to another. It is 8) Physical coupons: These are paper an infrastructure provided by NPCI‟s coupons which come in small (National payment Corporation of denominations of Rs 10 to Rs 50 with a India) to all the public, private & validity of 6 months to 18 months. cooperative banks where they can build These are used by corporates to reward their own interface and help the their employees. The best use of these common man easily make coupons can be done in buying meals micropayments with a maximum cap of from places such as Pizza Hut, Rs 1 lakh through various modes like Dominoes, KFC, Big Bazaar, etc. Out virtual address (a single identifier code), of many, two big giants that are account no with IFSC code, mobile providing these coupons are Sodexo and number or Aadhar number. It will ease Ticket Restaurants. the e-commerce payment gateway 9) AEPS (Aadhar Enabled Payment where we do not have to share account System): Going ahead, we can use number or any sensitive information Aadhar cards as a debit card in various between person to person. Moreover, merchant stores. These cards have been UPI works 24×7 on real-time fund already linked to our bank accounts. transfer system. They provide with a finger scanner at 7) E- Coupons: These electronic the merchant‟s store to doour payments. coupons are offered by various online Aadhar-cum debit cards will allow to do mega stores. They are very helpful in micro-payments for not more than Rs taking discounts on purchase done 4000. through online shopping. We only need 10) Med Health Cards: These are to enter the e-code and get the discount discount cards specially designed to automatically. They do not require any avail benefit from the healthcare sector. printing or clipping. They carry unique These cards provide various health care identification code which can be savings programs. These cards provide accessed through the internet at free OPD consultation service. we can particular sites. Some of the coupons use this card and get a health checkup which are available online are done. Airo International Research Journal March, 2017 Volume IX, ISSN: 2320-3714

Dhasai village as cash less economy. no money home, as everything was Dhasai is a large village located in done on credit. The chicken shop owner Shahapur of thane district sold chicken and mutton on credit, and maharastratotal 430 families residing. it's been 18 days after demonetization. Thedhasai village has population of Some have not even paid back the 2148 of which 1096 are males while money they owed him and he allowed it 1052 are females as population census in good faith."The impact of 2011. Children with age 0-6 is 214 demonetization was extremeand which makes up 9.96% of toal farmers, villagers, shopkeepers, and all population of village. This village has voiced the struggle. With a population higher literacy rate compared to of less than 10,000, most have Jan Dhan maharsthra in 2011, literacy rate of accounts and RePay debit cards. dhasai village was 84.75% compared to However, most never used the card 82.34% of Maharastra.In Dhasai village before demonetization. Primarily, a male literacy stands at 91.78% while village of farmers female literacy rate was 77.63%. As per and adhivasis (tribals), it has around constitution of india and panchayatiraaj 150 shops and is the biggest village Act, Dhasai village is administrated by amongst the 25 villages in the sarpanch (head of village) who elected surrounding area.There are two banks in representative of village.Because of the village – Thane District Central Co- Post demonetization, the situation in the operative Bank and Vijaya Bank. village got worse. No one had cash in Neither had any cash to dispense in the hand and all business were conducted initial days post the note ban. Even only on credit. those who managed to get cash later had Barbers had to cut their customers' hair Rs 2,000 notes and no one could tender on credit; groceries were sold on credit; change for such a high chicken, meat and medicines were denomination.When the situation got bought on credit; seeds and fertilizers out of hand, the villagers, traders and were bought and sold on credit. One local NGO person Naresh Raiker, a barber in the SwatantryaveerSavarkarRashtriya village, due to Post demonetization, he Smarak in collaboration of Bank of gave people haircuts onudhar (credit). Baroda decided to change things and The first day after the demonetization, ditch the dependency on cash.Navtej he did a business of Rs 450, but carried Singh, the general manager of Bank of Airo International Research Journal March, 2017 Volume IX, ISSN: 2320-3714

Baroda, Mumbai Zone, says,Nearly 40 of people who are well versed in net percent of shops have already been banking and those who are have given POS/EDC machines. smartphone or feature phone user, and The number of patients post the those without a mobile besides the currency ban. The OPD number fell by technologicallychallenged. 50 percent. However, the doctor was To ensure the system is modelled to quick to apply for the ECD machine and help small vendors, farmers and all had already gotten a few patients using those who deal in cash transactions, their debit cards to pay him consultation similarly the proposal will also fees. "The literacy in this area is low, highlight the amount to be deposited in just 60-70 percent of the population is the mahawallet by users. It will also educated, that too till 10th or 12th work on finding out how many citizens grade.To become a cashless, have many have bank accounts and how many use alternate routes, like card payments, net debit and credit cards. Efforts are to banking and mobile payments but low make a less cash society since being literacy is primarily the reason why they cashless is difficult. Mungantiwar the chose debit cards as the mode of minister said to create a system where payment instead of mobile banking,”. citizens will be required to carry less The trader knows how to use the EDC cash with them. The bank has installed machine and swipe the card, using a the machines for free and the trader debit card to make payments becomes a has to pay a fee for every swipe. The pretty painless act for most villagers, fee, also known as interchange money especially the illiterate ones.To mitigate in banking parlance, is fairly less just the impact of demonetization on the 0.75 percent for transaction up to Rs masses. The Maharastra government is 2,000. That's just 0.75 paise for every worked on “Mahawallet” to encourage Rs 100 swiped. The barber, and cashless transition. The finance minister shopkeepers are ready to pay a small fee “sudhirmungantiwar” told information of 0.75%.they didn‟t mind for spending. technology department to prepare a Many villagers said that carrying cash report based on the proposal. wasn't particularly the best option but Mahawallet will become a secure E- now carrying a debit card will make service where the citizens money would their live much easy. be secure. The I.T. department proposal In this village, a small government will considervarious facts like the needs school somewhere rural Maharashtra. Airo International Research Journal March, 2017 Volume IX, ISSN: 2320-3714

The school teacher gave ATM to the change. But now no question of losing aged between 12to 17 years would money or previous money. And some of spend Rs.5each from her account to get the students gave a step by step themselves goodies. Huddling at a local description about card in case of theft or teamart or a generalstore, they would loss. Bank of Baroda has opened bank buy biscuits or pencils or vadapaav or account over 150 basic saving account chocolates or fruits by swiping her card within 3 days of starting the drive. at small stalls. The teacher told the Vijaya bank the only national bank in student the use of cashless transaction. dhasai get at least 50 applications daily So, the student went back home and told for opening saving accounts. And the parents about a useof cashless deputy general manager of Bank of transaction and easy to use.The Baroda Mumbai metro south region, surroundings villages and tribal said over 90% of the swipe machines in settlements have a low rate of literacy. dhasai. Where found to be making good So, through their children a school business. Dhasai first rural area have teacher made them to understand what bunch note acceptance, machine a is the use of cashless. And how to cheque clearing machine passbook operate it. The school named printer an ATM machine clearing and Janatavidyala held a training account opening machine. To clear a programme around 800 cheque form dhasai took 8 days but in studentsattendedfor cashless economy digital branch acheque will go for and its importance. These students were clearing instantly. The journey of dhasai handed a gift cards issued by Bank of to words financial inclusion is worth Baroda and were thought hoe to conduct watching. transactions using the cards. They Some of the problems which stand in instructed to buy anything worth not the way of India becoming a cashless more than Rs.5 each. By using cards in society: our day to day lives also brings control 1. Cyber security: Due to over unnecessary expenditure. A 17- demonetization, the debit cards are used by people. So, there are many chance of year-old girl said, that A shopkeepers leakage of PIN number. There is no can no longer pocket small amounts. If security. There is a fear of exposed at ATMS. they bought things worth Rs.198or99. 2. Network connectivity: Since the day The shopkeepers would not give us demonetisation was announced, people are trying to use more of card back Rs.1 or Rs.2. they would say no transactions to save that dreaded trip to Airo International Research Journal March, 2017 Volume IX, ISSN: 2320-3714

the bank and to save the last penny of to find a public charging point if the the hard cash in hand. However, a phone battery discharges. Even metro sudden surge in card transactions has stations or railway stations in the tier led to connectivity issues. Several one cities do not provide that people have faced trouble while infrastructure. So, what happens if you standing in line to pay for a transaction have cash in your wallet, but you are at a shop when the card machines have out of battery after travelling on the stopped working due to an overload on road for a day? Is there any alternative the network. Connectivity issues must that we have then? be resolved before dreaming about a 8. Not enough bank accounts: Most cashless society. people still do not have bank accounts. 3. Internet cost: The internet cost in Most often there is just one account per India is still substantially high. There is family which also limits the number of no Wifi at public places and if people cards people can have individually. A do not get their monthly data packs family of even four people cannot be recharged, there is no way they can be dependent on just one card for all connected to make online payments. household expenditure. Internet connectivity is needed even for 9. Internet blockage: States like the e-wallets. In order to convince Jammu and Kashmir often face people to do cashless transactions, the crackdown where the internet is the first cost of the internet should be lowered thing that is blocked. In such and free WiFi should also be provided circumstances, neither is it possible to at public places. use cards for transactions nor is it 4. Charges on cards, online possible to use e-wallets. Any transactions: Heard of convenience alternatives there? charges? of course, you would have if 10. Encourage people to you do online transactions. These are spend: Spending by cards often additional charges that are levied by the encourages people to spend more. vendors when they offer an online giving cash by hand helps people keep a payment facility check on their expenses but paying by 5. Non-tech-savvy: While the new cards gives people a free hand. Not just generation is glued to their phones and through credit but even the debit cards gadgets, computer literacy among the give that impression that you can make people in the over-50-age group is still that payment immediately. low. Not many people are comfortable A cashless society is a welcome idea using computers or mobile phones and but not without preparation. There is a depend on their children when it comes precursor to taking such steps without to using the appliance. Before which a move such as this would be promoting a cashless society, efforts more harmful that being beneficial. A need to be taken to educate people on cashless society, for now, seems like a how to use phones for transactions. distant dream but a less cash society can 6. Smart phone affordability: Several be appreciated. companies have come up with new and inexpensive phones but they still not Benefits to become a cash less. affordable for most of the population in the country. More affordable options 1. Reduces instances of tax should be launched by the government avoidance because it is financial for people to buy smartphones for cashless transactions. institutions based economy. 7. Infrastructure/phone battery: India 2. It will curb generation of black still lacks when it comes to supporting a mobile society. It is extremely difficult money. Airo International Research Journal March, 2017 Volume IX, ISSN: 2320-3714

3. It will reduce real estate prices 5. Always choose a strong password for because of curbs on black accounts on net banking or online payment apps. money as most of black money. 6. Avoid making cashless transactions 4. It will pave away for universal from public computers such as those availability of banking services in cyber cafes. to all no physical infrastructure 7. Donot use free insecure Wi-Fi is needed other than digital. networks for making online payments, it may let an attacker steal 5. There will be a greater information. efficiency in welfare Conclusion programmes as money is wired The ease of conducting financial directly into the accounts of transactions is probably the biggest recipients. motivator to go digital. No longer need to carry wads of cash, plastic 6. There will be efficiency gains as cards, or even queue up for ATM transactions costs across the withdrawals.It‟s also safe and easier economy should also come spending option when we are down. travelling. The benefits are enormous 7. Reduce costs of operating if we leave out the low-income group which will face huge challenge. It will ATMS. be especially useful in case of 8. Speed and satisfaction of emergencies in hospitals.Dhasaivillage operations for customers no will become a role model the whole delays and queues no country as cash less economy. When a interactions with bank staff small illiterate village can become cashless why can‟t a whole country. required. While making cash transactions adopt How to secure cash less transactions. method of payments which is correct 1. Download online payments apps only and safely. from official apps only from official stores such as google play and apple References: store. www.civildaily.com 2. Before download any app verifies the cashlessindia.gov.in. publisher and read its user reviews. blogs.quickheal.com// 3. More importantly read the permissions www.brandbharat.com. that an app asksfor. if it asks for more www.uc.news.in than what is required then better avoid installing it. 4. Choose established and well known websites to make the payments.