By ET CONTRIBUTORS | Updated: Dec 17, 2016, 03.02 PM IST by Manoj Gairola
If digital transactions could curb corruption
and black money , Kenya would have been the most transparent country in the
world. About 75% of the adult population in Kenya uses mobile phones for
payments and money transfer. The value of mobile money transactions and transfers
per day is equal to 4.5% of annualised GDP of Kenya, as per a report published
in an International Monetary Fund (IMF) journal.
The use of mobile money is so widespread that
Kenyans can use mobile wallet to pay for goods at virtually any retail shop
throughout the country .This is something that the Indian government aspires to
achieve post-demonetisation.
However, Kenya was listed as one of the world's
most corrupt countries in Transparency International's 2015 Corruption
Perception Index, ranking 139 out of 168.
Corruption is so prevalent in Kenya that its team
participated in the opening ceremony of the 2016 Rio Olympics in mismatched
uniform.Reason? The officials had allegedly sold a part of the kit that Nike
provided to the National Olympic Committee of Kenya to distribute to all the
athletes.
Later, Nike lodged an official complaint with the concerned
authorities.Had it happened before 2010, the Indian Olympic Committee officials
could have got a clue from their Kenyan counterparts while organising the 2010
Commonwealth Games.
The same is true for other African countries
such as Tanzania and Zimbabwe where digital transactions are very high but the
countries figure low on transparency index. The Kenyan example is important as
the Indian government wants to create a perception that digital transactions
would curb black money and corruption.
Interestingly , it was not part of the original
speech of Prime Minister Narendra Modi on November 8. While announcing that Rs
1,000 and Rs 500 notes would cease to be legal currency , Modi had said, “This
step will strengthen the hands of the common man in the fight against
corruption, black money and fake currency... Enemies from across the border run
their operations using fake currency notes.“
Shifting
Focus
Nowhere did he talk about digital payments. Now,
all the ministers, policymakers and government advertisements are focused on
digital transactions. This change of narrative is clearly an afterthought.
In the last few weeks, the government has
announced various tax sops and rebates on the use of digital mode of payments.
It has set up committees of chief ministers and secretaries to promote digital
transactions.
If the government wants to promote digital transactions it
should simply implement its Digital India programme -which has not progressed
much in the last two-and-a-half years.
The vision document of Digital India says that
India would become a world leader in digital banking by 2019. It also lists
digital empowerment of citizens as an aim of the programme. Let us do a reality
check on Digital India. Good connectivity is a basic requirement for its
success. That is why Digital India's target is to set up a countrywide optical
fibre cable network connecting 2.5 lakh village panchayats by March 2017.
The target for March 2016 was to connect 100,000
village panchayats. However, only 8,000 village panchay ats could be connected.
By this October-end, only 15,000 village panchayats could be connected, thanks
to poor project management and flip-flop in policy he
delay in laying the optical fibre network is just one issue. If the government
has to provide e-education, tele-medicine and e-governance services, it has to
do a lot of work that requires digitisation of data and coordination between
various ministries.
Digital India
If the Digital India programme was going on as
per schedule, by now 200,000 village panchayats would have been connected and
services such as e-education, e-governance and banking would have been
available in remote areas. In modern day banking one needs only a laptop and
connectivity with core banking software to work as a bank branch.
Banking correspondents at village panchayats
could have easily acted as mini-bank branches. It could have saved a lot of
hardship in remote areas such as Uttarakhand where people travel up to 20-30km
to reach their nearest bank branches. The banking correspondents could have
easily promoted digital payments and mobile banking ..
As per the Digital India vision document, it would create 10
crore jobs by 2019. A few crore jobs would have already been created. This
should have brought in ` Achche Din'. This is in stark contrast to the current
loss of millions of jobs in the unorganised sector due to demonetisation.
The government brought in demonetisation to stop
corruption. However, some bank officials who are responsible for making it
successful are themselves involved in changing black money to white through
fraudulent means.
It is clear demonetisation can't stop
corruption. The government should strike at the mechanism that is responsible
for corruption and generates black money . Similarly, digital transactions can't
stop corruption.And demonetisation is not a way to promote mobile payments.
The government should follow its own Digital
India policy to promote a digital society that will include cashless payments.
Read more at:
http://economictimes.indiatimes.com/articleshow/56032014.cms?utm_source=contentofinterest&utm_medium=text&utm_campaign=cppst
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