Page 29 - Banking Finance February 2021

ARTICLE

IS INDIA

MOVING

TOWARDS

CASHLESS

ECONOMY

Introduction to a digital platform. In the past, the retail transaction was
entirely dependent on cash, but now the retail transactions
In this computer and digital era, we are very fastly moving
towards the digital platform in all fields of our life,the are very rapidly shifting from cash to digital platform. India
financial sector is not an exception. We all are using currency has one of the highest Cash to GDP (Gross Domestic Product)
ratios in the world, and lubricating economic activity with
notes in almost all financial transactions since the beginning
paper currency has costs. According to the study of Tufts
of the marketing era,but fromthe past few years, financial
University, the total cost of cash handling in India is Rs.
transactions are shifting to the digital platform very fastly.
The use of the digital platform is promoted by users, 21000 crore annually. This is a huge amount for our
economy. Apart from that, digital transactions have many
regulators and Govt. An economic system where no/less
benefits over cash transactions, So Govt. and RBI are trying
physical cash is in circulation is known as a cashless economy.
Payments are made through a digital platform such as credit to move to a cashless economy.
and debit cards, bank electronic fund transfers, or virtual
wallets instead of the cash payment system. The tools of Digital Transaction :
Initially, the cash transactions at the branch are replaced
Nowadays, in India, the payment system is rapidly transiting by an ATM transaction. But it is only an alternate channel
of branch banking services. As a result, a large number of
About the author cash transactions are shifted from branch banking to ATM,
but it is not towards cashless transactions. The RBI
Satish Kumar Pathak introduced NACH (National Automated Clearing House), CTS
Chief Manager (Faculty) (Cheque Truncation System), 24*7 availability of
Union Bank Of India NEFT(National Electronic Funds Transfer) system for the
Staff Training Centre, Gurugram
customer. The POS (Point of Sale), Mobile wallet (PayTM,

BANKING FINANCE | FEBRUARY | 2021 | 29