Cash is still king. In fact, as soon as new currency came into the market, people reduced or stopped using e-wallets and Unique Payment Interface (UPI) such as PayTM or the Bhim App. This despite the fact that many companies rolled out freebies, cashback offers, loyalty points and discounts. The government’s waiver of service tax on card transactions up to ₹2,000 to promote digital transactions did not convince the citizens either.
Many hardware stores in Delhi, vegetable markets, small eateries, weekly bazaars continue to run on cash transactions. In the first few weeks of demonetisation some cigarette and paan (betel leaf) sellers adopted e-wallets but its use has since been discontinued.
Why, you might ask? For one, you need a bank account to operate PayTM. Two, e-wallets charge up to four percent for using their app. Many don’t see much sense in paying a service fee for transferring money from one’s own account to another.
Uber drivers always had digital wallets even before demonetisation and a few of them got on board after it. But that is an account with the company, not personal one. Travel and you’d see that digital transactions don’t even make for conversations in Shillong, Goa, Bhubaneswar, Chennai or Kerala.
So, what are the lessons learnt from demonetisation? Have we all been conned?
The article was first published on November 8, 2017