Making Cashless more than just about going without cash

Last month, we launched Uttarakhand's first cashless card partnering Garhwal Nigam and Citycash in helping make the state's tourism as cashless as possible starting with the Kedarnath Yatra. The product is designed to work in poor connectivity locations and is a very rugged and simple solution. As Nainital Bank, our goal is to partner the state in becoming a preferred tourism destination for domestic and international tourists.

As we've gone about introducing this product it's interesting to learn that the main reason people want to use the product is not that it's more convenient than cash - in my opinion, very few solutions are. Nor are users really concerned about how digital payments help reduce black money - frankly, those that pay tax don't need to do this and those who evade, will continue to do so, digital payments notwithstanding. People use this because it's safer to carry the card with money loaded on it than carrying wads of cash along lonely stretches. Often, the weather gets tough as people climb up and notes get damaged. No such problem with this card. While our initial efforts are focused on the government as a partner merchant, our future plans must include the larger merchant community who's only reasons for accepting this as a mode of payment being 1) It helps them increase business because that's what their customers want and 2) Their likelihood of getting loans at better terms. They really don't care about anything else.

Which brings me to the larger point about digital payments and reducing cash. While growth numbers have been encouraging I believe going cashless is an incorrect goal. Infact, cashless should not be a goal at all just an outcome of a larger goal. Our goals on this must be to help those that are willing to create their digital footprints see the benefits of doing so.

20 months ago (basically, right after demonetization) I started paying our driver via a bank transfer in his account rather than cash. He wasn't happy cause he believed I had simply transferred the job of ATM withdrawals from myself to him (which I must admit is partly true). However, I told him then that after he's built up a footprint, his inclusion in the formal banking system will happen, meaning his bank will treat him better and offer him products and services like cards and loans. 20 months of credits in his bank account labelled "Salary for the month of ----" and he hasn't received one offer of a loan, for affordable housing or health insurance or a credit card. As statistics go, his salary credit allows for him to be categorized as middle class or at the very least one of the "Aspiring billion". He's had the same phone number and job for over 5 years now and yet he isn't an acceptable credit risk. His concern now is that he hasn't been offered anything from his bank, when he needs money he'll still need to borrow money from the moneylender or friends and family and what's worse, he now has a 'footprint' that the income tax people will now use to demand money from him (he's still under the minimum taxable income bracket but you can see that it's a valid fear).

Isn't it time to make people's digital footprints really count for them - by helping things they, as consumers really care about, not what the government thinks they ought to care about.