CSES in Media

Rural populace yet to go cashless

This report on CSES study was published in The Hindu on 09.11.2017

Inadequate facilities and fear over security to blame for poor patronage, says study

The push towards cashless economy, which was one of the major objectives of demonetisation, has not received the expected traction in rural areas, going by a survey conducted in Ernakulam, which was declared financially inclusive not so long ago.

The survey conducted by the Kochi-based Centre for Socio-economic and Environmental Studies (CSES) at Asamannoor, Pallippuram and Maneedu panchayats in the days leading up to the first anniversary of demonetisation found that only 14.60% of the sample group of over 300 opted for digital transactions.

The number further plummeted to 9.60% when it came to those who have made at least one cashless transaction in the last three months.

Significantly, the number of users of cashless transactions was found to have dropped in the last one year among government employees, farmers, and the unemployed, whereas it grew by 26% among students and 11% among private-sector employees during the same period.

Among the reasons cited for the lack of interest in cashless economy were absence of adequate facilities, fear over security, poor internet connectivity, and inadequate pay for depositing in bank accounts.

Unsurprisingly, high income groups, educated people and youngsters topped in using digital transactions, whereas members of Scheduled Caste and Scheduled Tribe communities accounted for a meagre 3.80%.

Twenty per cent people of the above poverty line category adopted cashless transactions compared to just 4.60% of those of below poverty line. Nineteen per cent of men used digital transactions, while it was 10% among women.

Factor in age also

Age is also a significant factor when it comes to adoption of cashless ways, going by the findings of the survey. While 40% of people aged below 30 years used digital transactions, it was just 3% among those aged above 60 years. The rate of growth among youngsters using cashless transactions compared to last year was 16.70%, while it was only 1.50% among 60-plus.

Education is another factor, as 46% of graduates and postgraduates and 54% of those with professional education adopted cashless transactions compared to only 3% among those with education below Standard 10.

Credit cards accounted for 3.30%, internet banking 4.30%, mobile banking 4%, and e-valet 3.60% of cashless transactions.

While 7.60% among the surveyed started adopting cashless methods this year, 2.60% among those who used it last year did not adopt them.