Wednesday, October 16th, 2019

Cashless Society: India Bans Currency Notes Sparking Chaos At Banks

Published on November 12, 2016 by   ·   No Comments

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John Vibes

The government in India has recently made a move to ban large currency notes, continuing the push towards a cashless society, an effort that the country has been working on for decades. 500 and 1,000 rupee notes were banned throughout the country, which may seem like large currency notes, but they exchange for just a few American dollars, and represent 85% of the cash transactions in the country.

The ban sparked a run on the banks in India this week, with customers forming massive lines at banks attempting to get cash notes out while they still could.

Banks then shut down on Wednesday, and limits were imposed on ATM withdrawals.

Politicians say that the new measure is aimed at fighting tax evasion, corruption, and “black money,” but the nation’s poor say that they are going to be the hardest hit.

“I went home for Diwali and my parents gave me money as a gift. I wish they had a simpler system for students. I desperately need cash to pay my rent and buy books and food,” Vijay Karan Sharma from Chhattisgarh, a student at Delhi University, told the BBC.

New notes with advanced security features will be put into circulation to replace the current notes; however, financial experts in India suggest that this could be a step towards a cashless society.

Infosys founder N R Narayana Murthy celebrated the ban, and said that this could help push the country towards a digital economy. Of course, this will not be a free digital economy where people will be able to choose which currency they want to trade with, but it will be a top-down controlled economy with a single monopolized currency, that can be traced and tracked at every turn.

“Prime Minister is working hard to reduce corruption. Black money is a scourge on any developing economy. He has been a great supporter of digital economy. So yesterday when he made the announcement, I thought it was a master stroke,” Murthy said.

However, the move is not entirely popular among everyone in India’s political establishment.

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