Cashless Economy Flashcards
1
Q
- Positive Impact on Society - cashless economy has the capacity to reduce ash based crimes.
- Attack on Parallel Economy - This is one of the most important reasons why a cashless society is must.
People who hoard money under their bed (also known as black money), people who launder money bypassing banking channels, terrorist who need money to finance their terror etc will run out of business now. - Financial Inclusion
A
- Increase the Tax Net - All the transactions that are done can be monitored and traced back to a given individual.
If officials from tax department smell something fishy then they can trace the money transaction back to the individual.
Hence it will be really difficult for someone to evade tax. Increasing tax net is very important for any government.
2
Q
- Security and Convenience - The biggest motivator to go digital probably is the ease of conducting financial transactions. You no longer have to carry cash, credit or debit cards, or even go to ATMs for cash withdrawals. When you are travelling, it’s also a safer and easier spending option.
- Budget discipline - The written record will help you keep tabs on your spending, resulting in better budgeting. Controlled spending could also result in higher investing. There’s a lesser chance of budgetary leaks and unaccounted for spends sneaking into your budget at the end of the month.
A
- Lower risk - If stolen, it is easy to block a credit card or mobile wallet remotely, but it’s impossible to get your cash back.
3
Q
DRAWBACKS
- Higher risk of identity theft - The biggest fear is the risk of identity theft. Since we are culturally not attuned to digital transactions, even well-educated people run the risk of falling into phishing traps.” With the rising incidence of online fraud, the risk of hacking will only grow as more people hop on to the digital platform.
A
- Difficult for tech-unsavvy - A bigger block is the psychological shift. You are suddenly jumping three generations to the digital medium. It’s a problem for the older people, who may suddenly find themselves locked out of their accounts if they can’t download an app or don’t have cash.”
