5 things to know about India’s
journey to a cash-less economy
It has been more than three months since the government announced the demonetization of the Indian currency.
In addition to the eradication of black money, the aim of this drive was to convert India into a less-cash economy.
Here are five things to know about India’s journey to a less-cash economy:
After-effects of demonetization:
The number of digital transactions increased by 400-1000% after the announcement of demonetization, according to a
report by Times of India. But over the past month, this sudden surge seems to have come down to a more stable level.
This is due to an increase in the circulation of currency in the system.
India vs. The world:
India has a long way to go if it wants to match global levels of digital payments. Currently, India has 1 Point of Sale (POS)
terminal to be used by around 900 people, as per a Kotak Securities report. In comparison, the global average for number of
people per POS terminal is 100. The value of digital transactions in India is around Rs 1.8 lakh crore. This is comparable to
other major countries like Italy and Mexico, as per the Kotak Securities report. However, at Rs 67,000, India still performs
poorly in terms of per capita transaction value.
Proper infrastructure essential:
Increase in digital payments is necessary for a successful journey to a less-cash economy. This can be possible with an
increase in mobile and internet connectivity in the country. The government should invest more in proper infrastructure to
achieve this goal.
Journey will take some time:
The transition from cash to digital is not simple. Developed economies like the UK and Sweden took decades for this
transition. The demonetization drive gave a major push in the right direction. But greater inclusion of rural and urban poor
is necessary to expand the digital footprint.
Vision document by the RBI:
The RBI highlighted seven ‘A’s for a successful transition to a less-cash economy. Accessibility, Availability, Awareness,
Acceptability, Affordability, Assurance, and Appropriateness .
Existing technological advancement in India can ensure a faster transition compared to other less-cash economies.
The demonetization drive has certainly propelled India towards a less-cash future. However, this is only the beginning. The
government and the people should collectively participate to realise this vision.
Kotak Securities Limited. Registered Office: 27 BKC, C 27, G Block, Bandra Kurla Complex, Bandra (E),
Mumbai 400051. CIN: U99999MH1994PLC134051, Telephone No.: +22 43360000, Fax No.: +22 67132430.
Website: www.kotak.com / www.kotaksecurities.com. Correspondence Address: Infinity IT Park, Bldg. No 21,
Opp. Film City Road, A K Vaidya Marg, Malad (East), Mumbai 400097. Telephone No: 42856825. SEBI
Registration No: NSE INB/INF/INE 230808130, BSE INB 010808153/INF 011133230, MSEI INE
260808130/INB 260808135/INF 260808135, AMFI ARN 0164, PMS INP000000258 and Research Analyst
INH000000586. NSDL/CDSL: IN-DP-NSDL-23-97. Compliance Officer Details: Mr. Manoj Agarwal. Call: 022 -
4285 6825, or Email: email@example.com. In case you require any clarification or have any concern,
kindly write to us at below email ids:
• Level 1: For Trading related queries, contact our customer service at ‘firstname.lastname@example.org’ and for
demat account related queries contact us at email@example.com or call us on:
30305757 (by using your city STD code as a prefix) or Toll free numbers 18002099191 / 1800222299 and
• Level 2: If you do not receive a satisfactory response at Level 1 within 3 working days, you may write to us at
firstname.lastname@example.org or call us on 022-42858445 and if you feel you are still unheard, write to our
customer service HOD at email@example.com or call us on 022-42858208.
• Level 3: If you still have not received a satisfactory response at Level 2 within 3 working days, you may
contact our Compliance Officer (Name: Manoj Agarwal) at firstname.lastname@example.org or call on 91- (022)
• Level 4: If you have not received a satisfactory response at Level 3 within 7 working days, you may also
approach CEO (Mr. Kamlesh Rao) at email@example.com or call on 91-(022) 4285 8301.
This is an editorial content, our research should not be considered as an advertisement or advice, professional
or otherwise. The investor is requested to take into consideration all the risk factors including their financial
condition, suitability to risk return profile, and the like and take professional advice before investing.