Stressing upon the need to move to a cashless economy, Prime Minister Narendra Modi on Sunday made a strong pitch, especially to the youth, to move to technology-based financial transactions such as e-banking, mobile banking and other facilities such as Unified Payment Interface (UPI) for their daily financial transactions.
The PM sought the cooperation of all sections of the society, despite the difficulties, to make the transition to the new currency denominations a success. Even after three weeks post the demonetisation announcement, banking system is still struggling to meet the cash requirements of people, with long queues still seen before ATMs. Small traders,vegetable vendors and farmers are hit hard due to the currency shortage.
Addressing the nation through his monthly radio programme "Mann ki Baat", Modi urged the youth of India to take a pledge to become part of a 'çashless society' for a corruption less, black money-free India.
"Poor started using Rupay card, which was not used that frequent, after 8 November decision and nearly 300 percent development happened," Modi said in his radio programme.
For small traders, who have been facing the hardships due to the prevailing cash crunch in the system, Modi urged them to adopt cashless method. "I urge my trader brothers and sisters...this is an opportunity for them to enter the digital world," said Modi, adding that adopting cashless economy will bring about a huge transformation in the country.
Modi has been more vocal about the usage of less cash and more digital technology-related transactions in the economy, given his decision earlier in the month (8 November) to demonetise high denomination currrencies of Rs 500 and Rs 1,000 notes from the system to keep a check on the black money generation.
It has been estimated that people have exchanged and deposited over Rs 5.44 lakh crore worth of scrapped Rs 500 and Rs 1,000 notes at different banks till 18 November following demonetisation of the higher denomination currency.
Although the government's demonetisation decision was welcomed by majority of the poeple across the country, the Centre, however, came under severe criticism from various political parties for not taking evasive measures to ease common man's concerns.
Specifically, the decision led to severe cash shortage in the economy, with bank branches and ATMs frequently running out of cash in just few minutes time, thereby, leaving people hassled. With several ATMs for better period post the demonetisation announcement were not calibrated to dispense new cash denominations, people standing in long queues were forced to leave with little or no cash at times.
Reports of several people losing their lives standing in long queues to withdraw money triggered angry reactions from the masses with some even calling for the government to roll back the decision.
The government's constant flip-flop on exchanging and depositing old cash notes in the bank branches, besides changing the limits on cash withdrawals created lot of confusion among the people.
Immediately after the demonetisation announcement, the government first permitted people to exchange banned notes of up to Rs 4,000, with the exchange limit later being increased to Rs 4,500. The government also asked banks to start using indelible inks on customers exchanging old notes on fears that same people were going to different banks to exchange old notes.
A week later, the government reduced the exchange limit from Rs 4,500 to Rs 2,000. On cash withdrawal front, the government first allowed Rs 2,000 to be withdrawn before increasing it to Rs 4,000 per card. The government also kept changing the daily and weekly withdrawal cash limits at banks leading to lot of confusion among the people.
While the government has been hell bent on flushing out fake currencies and black money from the system, traders, vegetable, fruit and flower vendors across the country have already witnessed a major slowdown in their businesses in past few weeks.
With the business being hit hard, especially, in the country's unorganised and MSME (medium and small enterprises) sectors, there have been reports of massive job losses across the country. Last week, CPI leader Sitaram Yechury said over four lakh people have lost their jobs due to the demonetisation exercise.
Finally, the demonetisation move has forced several economists, rating agencies and brokerages to slash the country's GDP growth estimates for the next few quarters citing subdued consumer spending and likely slowdown in economy. Not just that, former Prime Minister Manmohan Singh, too, last week cautioned that GDP could fall by about 2 percent in the aftermath of demonetisation.