The village of Dhasai initially embraced a cashless economy after demonetization, with villagers using ATM cards and mobile payments like BHIM. However, presently only 15-20% of daily transactions remain cashless. This is due to several factors, including a lack of access to banking services and digital literacy - only 4,000 of the 27,000 bank account holders have ATM cards, and 30% of account holders are illiterate. While some merchants have card payment machines, smaller vendors without bank accounts cannot accept digital payments. Sustaining Dhasai's early cashless success has proven difficult.

1. BY:
AISHWARYA JOSHI
MBA(FS)- III SEM

3. Cashless simply means using less cash ,
everywhere we use cash. Which might be-
• HOSPITALS
• PUBLIC TRANSPORTS
• TOLLS
• SCHOOLS
• PETROL STATIONS
• KIRANA STORES

7. Reduction in cost of currency management

16. Mobile wallets is most helpful way of
making cashless transactions as it is a
convenient way of making payments
anywhere anytime

22.  ATM withdrawals recorded a 22% increase in April
2018 from the previous year, reaching 2.6 lakh
crore. In comparison, cash withdrawals accounted
for 2.2 lakh crore in the months leading to
demonetisation.
 Debit card usage is also up, showing that Indian
consumers are comfortable with the flexibility of
choosing whichever payment method best applies
to their needs. In fact, debit card usage at point-
of-sale (PoS) terminals grew by 24% compared to
2017. Contrary to cash however, debit card usage
was very low – almost 50% less – prior to Modi’s
demonetisation policy.

24. 98% of all consumer payments in India use cash
About 98 % of all consumer payments in India use
cash, and the high frequency of handling forces the
monetary authority to withdraw about 75 % of its
notes in circulation in a typical year - more than the
number of bank notes collectively produced by all
countries taken together with the exception of
China.
-Economic Times

27. According to money supply reports from the RBI, in the first four
months of 2018, the amount of cash in circulation rose by more than
Rs2 trillion, i.e. from about Rs17 trillion to over Rs19 trillion—a
nearly 40% annualized growth rate. That is far faster growth than
before demonetisation and much faster than growth of nominal GDP,
which is expected to rise by 10-12% in the 2018-2019 fiscal year.

38. Some more reasons , why India can’t go cashless-
• Large number of populations do not have bank account
• Lack of POS machines
• Merchants prefer cash to avoid paying tax
• People are not modernized enough to use smartphones and internet

39. At a time when people across the country were still
queuing up outside banks, villagers in Dhasai swiped
freshly acquired ATM cards at shops. However,
presently, only 15-20% of daily transactions have
remained cashless

40. Dhasai, a quaint village in Murbad taluka located about 100 km to
the northeast of Mumbai, embraced a cashless economy on
December 1, 2016, roughly a month after demonetisation.
At a time when people across the country were still queuing up
outside banks, villagers in Dhasai swiped freshly acquired ATM
cards at shops, most of which had installed swipe machines. Those
with smartphones had switched to mobile banking and the BHIM
app launched by
Prime Minister
Narendra Modi.
Queues outside ATMs
had disappeared
overnight and even
vada pavs could be
bought by paying
through BHIM.

41. However, presently, only 15-20 per cent of daily transactions have
remained cashless.
The Thane District Cooperative Bank (TDCB) in dhasai has close to
27,000 account holders. Of these, only 4,000 have been issued ATM
cards. “New account holders get ATM cards immediately and we
issue cards to those who apply for one’’ said branch manager, Ashok
Warghade.
“This gap in the number of accounts and cards has been a
disadvantage. While there is a willingness among villagers, they
don’t have the means to carry out cashless transactions. Initially,
during the days of demonetisation, the response had been very
good but eventually when cash started flowing into the ATMs,
people returned to cash,” said Ranjit Savarkar, chairperson of
Swatantryaveer Savarkar Rashtriya Smarak, which had brought the
cashless project to the village by tying up with Bank of Baroda.

42. Bank of Baroda, too, has set up an e-lobby in Dhasai and issued PoS
machines free of cost to traders but the exact number of account
holders is not clear.
“There are many misconceptions among the villagers about using
ATM cards such as excess tax deduction or security lapse. People
reserve their card
transactions for
certain purchases
where the
amount is higher,”
said
Swapnil Patkar,
president of the
traders’
association of
Dhasai.

43. For those who have a card, there is a bigger issue – how to use
it. Of the total number of account holders, around 30 per cent
are illiterate and can’t use cards, according to bank officials.
“I have a Jan Dhan account but I don’t know how to use an
ATM card, let alone do mobile banking. My children and
grandchildren use it sometimes,” said Gajanan Ghulap, a
septuagenarian farmer.
Not all traders have been issued swipe machines either. Of the
over 80 traders, vendors and shopkeepers in Dhasai, 65 have
swipe machines, said Patkar. Smaller vendors – fruit and
vegetable sellers – who do not have bank accounts can neither
keep swipe machines nor use net banking. “Applications for
swipe machines have been pending with banks for over six
months,” he said.