What Does It Take To Go Cashless?

DELHI: In the past, it passed for a moment of instant fun. In shops, behind the busy payments counter, you saw this advisory on bold display: "In God we trust, others pay cash!" This was their way of telling the customer that you'd better pay for the purchase cash down, no running after in case you default! Long after those times, you are perhaps inclined to believe that the cash-only obsession has withered away. Think again!

True, smart cards are all over the place. Shopkeepers do not have to worry any more about default, as they did in earlier times. Yet, some of them still mumble as you take the card out: "Dekhoji, hamara machine kharaab hai (Look, our machine is not working)!" Others cut out niceties and warn you upfront that card payment could cost more.

What, then, is the option you are left with as a purchaser? Cash is no more a problem. ATMs are there at every urban street corner and withdrawal costs you nothing. Next time round, learning by experience, you start carrying enough cash with you. Just in case!

But does the ATM withdrawal indeed cost nothing? Ask the banker. For he knows where the shoe pinches. It costs the bank a good 15 a transaction. Add another 5, given the new requirement to position security guards outside ATM booths after the recent spate of daring robberies. All this does not move the un-pinched customer a wee-bit. For banks are mandated by the Reserve Bank of India (RBI) to subsidise the ATM withdrawals. Yes, free withdrawal passes for a customer right!

Read More: Is Unavailability Of Land India's Biggest Problem?