Imagine figuring out a way to travel back in time! Clear blue skies, without a hint of an approaching furrowed forehead, and streets ringing with the valor of Indian revolutionists in post colonial era, are sure to entice people, who’re often nostalgic of the bygone days. However, it’s all fun and games, until the way we’ve been crippled by technology, begins to abet our odds of managing our lives on the daily.
Habitual techies with regard to money and digital payment, would have more than a hard time, physically visiting banks to get Demand Drafts and Money Orders sanctioned, and enduring the desperate delay that awaits. Travelling back still further, and witnessing people bartering a couple of bags of grains for a full-fledged buffalo, and walking the animal back home, would indeed be nightmarish for these habitual techies.
Coming back to the contemporary scenario, the demonetization of Rs. 500 and 1000 banknotes in 2016, brought forth a paradigm shift in the Indian economy. This bold move by the Indian government, aided the eradication of black money to some extent, and initiated the transition towards a cashless economy. A promising modification, it has taken a significant toll on people’s money managing practices.
1. Does a cashless economy promote mindless spending?
While a cashless economy makes payments almost effortless, it, via varied stakeholders, indirectly encourages mindless spending. A surge in the usage of E-wallets and UPI-based digital payment methods, has made these methods a hit among people from all sorts of socio-economic backgrounds. Although customary for people hailing from certain economic backgrounds, these digital payment methods are now prevalent nation-wide. Be it auto rickshaws or local food stalls, the ubiquitous QR code is hard to ignore!
However, the increasingly omnipresent nature of digitalization in India, and consequently, people’s inability to consciously perceive the money slipping out of their hands, renders them careless with regard to mindful expenditure. The usage of these modes for routine payments, many a time, makes excessive expenditure go unnoticed, as the transaction materializes with just a trivial click, and there isn’t much physicality involved either.
2. The Paradox of Discounts
With the rise of online payment mechanisms, the market deploys different tactics in a bid to seize this new-found opportunity, and offers lucrative schemes, that revolve around E-wallets and UPI-based modes. On choosing these E-wallets as the preferred mode of payment, a deal is cracked by providing discounts on already overpriced services and products. This tricks people into believing that they’re saving a great deal of money, however, it’s often the other way around, and they end up spending more than they had considered. This traps them in a vicious circle, and these small overheads add up to huge losses over time.
3. The Risk of Fraud
With our entire life’s savings scrunched up into these E-wallets and virtually-operated bank accounts, and the passwords to these accounts saved in a machine called phone, we have become way more susceptible to scams and technical glitches. A leaked password or a hacked or lost phone can cost a lifetime’s worth of struggle. Apart from scams, a minor glitch can get people stuck in desperate times, owing to their utter dependence on online payment methods, and a lack of readily available cash.
In conclusion, digitalization is a promising and futuristic transition, that along with its immense scope, has its own share of downsides that people need to steer clear of, by keeping a track of their digital money.