Changing society with money!

                                       

     I would like all of us to consider a hypothetical situation where all the money transactions take place through a channel and the transactions are recorded, there is no physical cash, money is only available in electronic format. This channel can be a bank. For e.g. Consider a situation where I go out for a shopping and I need to buy 1 kg of onion. I instead of exchanging a 50 Rs. Note instead of normal transaction, this transaction takes place through transfer of money from a card emitting radio signal or may be a mobile phone. This transaction happens in seconds and the amount gets transferred instantaneously. This seemingly easy transaction can solve many problems of present time.

Ø      Tax: The government can keep a tab on incomes and accounts of the people, which can help garnering revenue in form of taxation (direct and indirect both).

Ø      Black Money: Can control the parallel economy since no money can exist outside the banking records.

Ø      Corruption: Can help in controlling corruption.

Ø      Theft and robbery: is not easy anymore i.e. crime can be under control as goods stolen cannot be sold out easily since all the transactions would be recorded and any unaccounted entry can lead to suspicion.

Ø      Effective Planning: Control over liquidity and more precise planning by the government for its expenditure.

Yes with this idea there are many concerns such as amount of data to be handled, devices that are cost effective, servers, records, covering up remote areas. On the flip side it’s like putting all the eggs in one basket. There are few strategic concerns which need to be addressed. For e.g. Failure in banking system can create a chaos; there would be no currency available for circulation. In case of events of emergency like war, the electronic system might not be effective.

     I believe this would be the future which lies ahead. The present constraints which are being a stop can be resolved with use of other systems and technology which can be put in place. But such an order might face resistance from those who are being cause in the problems stated above.