The world is gradually moving towards a digital economy wherein the monetary and other transactions are driven by digital technology. The advent of payment wallets, net banking, UPI transactions etc. has not only eased the payment process but has also helped in checking the black economy where on account of the cash transactions evasion of taxes was easily possible. Further the COVID 19 pandemic has accelerated the use of digital mode of transactions. With digitization, the need for currency in hand is reduced to a large extent. Also, the requirement of printing notes and its circulation within the economy is also reduced to a large extent saving the government in reduced printing Bill’s. The digitization of ecommerce has also accelerated the growth path of the economy. Ecommerce is a big revenue generator for the economy and it has created more employment opportunities both directly and indirectly.
The Banking Financial Services and Insurance sector of the Country is another Sector which has also benefited a lot due to the digitalization of the economy. Financial institutions, loan processing institutions have started using more of digital mode in meeting and processing customer financial needs. Gone are the days when we used to rush to a bank/financial institutions for meeting our financial requirements. Loan processing institutions are facilitating in processing using the digital mode like EKYC, documents submission which has fastened the entire loan processing time frame. It was only due to the use of digital technology, the world was still able to work by having Virtual meetings, kids having online classes instead of class room learning.
Eventhough we may see many benefits of having digitization of the economy, a flip side to such an economy is for a Country like India which on account of large uneducated, poor population will not be able to fully reap the benefits of digitization. Agriculture being a major employment generator and a contributor to the economy, still uses mainly cash transactions as people are still averse to using the digital methodology either out of fear of loosing money for online frauds, lack of knowledge, interdepency on other people/ third party/middlemen who generally prefer doing transactions in cash. Another important reason for lack of digitization in the Country is that the infrastructure in the Country especially in the rural areas is still not good enough to facilitate the growth. Development of basic infrastructure facility like water, Power, roads, schools, hospitals would have accelerated the digital economy
In view of the above, as we are aware of the benefits of digitization we should do more transaction through digital mode as it will accelerate the development of the economy. Further it will help the government in generating more money and check on the flow of black money.
Article published by: www.loansaarthi.com