GD Topic: Cashless Economy - Are we Ready for the Transformation?

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Updated on Jan 25, 2023 13:21 IST

There are several compelling reasons to believe that India is indeed ready for a cashless economy. Likewise, several points may be directed against this concept. Let's explore it as a topic of GD for MBA admission.

By Aritro Dasgupta

This article was first published on August 26, 2019.

A Group Discussion (GD) round is a test of multiple competencies. On the one hand, the aspirant needs to have enough content to speak on the topic. One the other, he/ she needs to be able to deliver the same. It is thus not merely content, but also the communication skills. But the important thing is, while one’s passion on a topic must emerge, one must also remain calm enough to speak constructively on the same. No rude gestures are tolerated by the moderators.

Above all, a GD is a test of one’s leadership qualities within a group. In this series of articles, we explore certain topics which are quite likely to be in line to be asked in the GD rounds at the top MBA colleges in India this year. These are all based around the most important of current affairs topics from business, economy and society.

Check: Top MBA Entrance Exams You Can Take in 2023

One such area is the concept of a cashless economy, and whether India is ready for the same. Like almost any other topic, this too can be answered in either For or Against motion. Let us explore each option:

GD Topic: Cashless Economy - Are we Ready for the Transformation?

For the Motion

There are several compelling reasons to believe that India is indeed ready for a cashless economy. More than the capability of doing so, there arises the question of whether we ought to try for the same, and what would be advantages in achieving that. They may be discussed through the following bullet points:

    1. There has been a massive expansion of the formal banking imprint over the last few years, especially due to the efforts of the Jan Dhan Yojana, which is a central government initiative. The number of bank account holders has doubled during this period as per official figures.
    2. Indians are worldwide known for their IT skills, a lot of which is required in building the infrastructure needed for such a cashless economy. The brain power exists to create this infra.
    3. India is also home to the phenomenal success story of digital wallet and payment app-Paytm. It is by all means, one of the top unicorns in the world today, with a substantial valuation. In addition, we also have other such gateways such as Mobikwik and Phone Pe. The government has also pitched in, with its BHIM (Bharat Heavy Interface Mechanism) app.
    4. Corruption can be controlled to a large degree with the contraction of the cash economy. This will happen as all transactions will now get recorded via digital transactions.
    5. A cashless economy will also be good for the social aspects of the economy. Women will also now get their payments in their bank accounts, thus reducing their dependency on men of the family, who usually control the household expenses.
    6. This increased financial power in the hands of women will also be a boon towards the next generation. There will be a far greater chance now of the household savings to be diverted towards children’s education, rather than alcohol, or other social ills which have been seen in patriarchal societies.
    7. India is also a country with a large proportion of internal migrant labour. This population can more easily transfer their earnings in bigger cities to their homes in the hinterland.
    8. The dependence on the middle-men and money lenders, who are often unscrupulous, will be reduced to a great extent in a cashless economy.

Against the Motion

Likewise, several points may be directed against this concept of cashless economy, and its place in India. Following are some of the most compelling of those:

  1. While indeed there has been a substantial official increase in the number of account holders, there is still much needed to be done to educate the people about how to use their accounts. Merely possessing an account is of little use if there is no support at the grassroots level to the people who have rarely even seen a bank.
  2. Even if people were to have greater knowledge of the banking system in some time, understanding the digital means and actually trusting enough to the effect of their lifetime savings may remain merely a pipe dream.
  3. There is a general air of distrust towards banks in certain quarters, as evidenced through the case of large banks charging penalties from the poorest of account holders, for not maintaining minimum account balance.
  4. Corruption cannot be controlled by contracting the cash supply alone, as there are several other means, including notably gold bullion and real estate.
  5. A cash economy is also the backbone of several unorganized industries, employing millions of people. Shutting these industries will be akin to taking away these peoples’ employment opportunities.
  6. It is true that Indian tech personnel are responsible for several top tech giants worldwide, so we do have the requisite talent to develop the infrastructure. But these same Indians thrived in an atmosphere were corruption was minimal. Thus, the bureaucratic and government machinery will need much cleaning before these people can make a similar impact here.

Thus, we can clearly see advantages and disadvantages on both sides of the divide. Perhaps we can implement the concept of a cashless economy on a smaller scale and see how it works in urban, affluent areas. Some experiments have already proven to be grand successes, as shown in the Dasai village in Maharashtra’s Thane district, the Akodara village in Sabarkantha district of Gujarat and West Bengal’s Pradhabari village, near the city of Siliguri. Once the concept gains broader acceptance, it may well be adopted on a larger scale.

About the Author:

Aritro Dasgupta is a Teacher, Trainer and Content Writer. He has taught at several leading colleges and coaching institutes in both India and the UAE. Several of his students have finished in the top 10 of various national level exams such as CLAT, AILET and DUJAT. He is also a prolific content writer, having written for several leading publications in India, while currently, also working for one in the USA.




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