New Delhi: The Central government that had taken the decision to demonetize 1000 and 500 rupees currency notes last year, is all set to take an another important decision to encourage digital transactions. Pravin Khandelwal, secretary general of Confederation of all India Traders (CAIT), has expressed the possibility of central government announcing its decision to withdraw cheque books in the near future
After demonetization, many especially traders are carrying out transactions through cheque on large scale. Government is likely to take up the decision of withdrawing cheque system with a view to push digital transactions, said CAIT secretary, Khandelwal.
Khandelwal further added that the government incurs expenses upto Rs.25,000 crore for printing currency notes. Besides, Rs.6,000 crore are spend on their logistics and security. Government charges 1 per cent tax on transactions through debit card and 2 per cent on credit card. Government also intends to waive off the said tax and instead give direct subsidy to Banks, asserted Khandelwal.
It has come to light that this year’s transactions through debit and credit card has increased by 84 percent as compared to last year and have reached up to 74,090 crore. Nevertheless, till today 90 per cent transactions are carried out by cash and cheque system. Banning cheque transactions would give a boost to digital transactions; this seems to be the motto to withdraw cheque. Government intends to bring transactions to the tune of 25 billion rupees under digital system by the end of this financial year.
Although this task seems to be very difficult, the decision to ban cheque is likely to speed up digital process and lead to its expansion. However, experts claim that, this transition in a country like India is very challenging. Even today, no reduction in the number of cash transaction, especially post demonetization, supports the said claim even strongly.