How to go cashless in India

On November 8th 2016, in a nationwide address, Prime Minister Narendra Modi surprised the entire nation by demonetizing the two highest currency denominations of the country, i.e. the Rs. 500/- and Rs. 1000/- paper currency. This was a bold move done to weed out the black money from the system.

Initially, everyone was shocked by this sudden decision. As we all know, India is primarily a cash economy with more than 70% of the people using cash for their daily transactions. Though the common man is facing a lot of hardship in the process, we as Indians hope that in the long run this demonetization move will yield the benefits that it claimed, it would achieve.

One thing that has emerged positive from this scenario is the importance of going cashless. People have now realized the importance of transacting online by making electronic payments, even for the smallest things. This move is definitely going to encourage the common man, including the people in rural areas, to use digital and mobile wallets extensively. The government will be able to monitor all transactions, leading to the curb of benami and black money transactions.

It is still going to take a couple of weeks before the new currency is easily accessible to every person in the country.

So here’s how you go cashless in India:


The common man mostly travels by bus, rickshaw or taxi, which do not accept money through digital wallets. However going by the current circumstances, some of these transportation modes have started using digital mobile wallets from Paytm and Freecharge.

While transportation continues to is a big worry, you can also travel by Ola, Meru and Uber cabs, as these cabs have their own digital wallets. It is definitely more expensive than your normal travel.

Currently both, the railways and the Metro, are still accepting the old currency notes and hence there is some respite for the common man. There is also an app called Unreserved ticketing system app (UTS), which helps you to book e-tickets by all  train routes i.e Central, Harbour and western lines.

 Groceries and Foods

The last few days have seen all of us struggle to buy our groceries. There are various mobile apps from retailers like Big Basket etc , which when transacted through, will deliver all your groceries right to your doorstep, at very competitive prices. Hypermarkets such as Hypercity too have their own app, wherein all your groceries are delivered to your home.

Those who want to continue eating out, can order via the food Apps of different food chains like Zomato, Dominos, Pizza Hut, faasos etc.

 Digital wallets

Let us understand the concept of digital wallets. Digital wallets help you to pre load your money into an electronic wallet by using net banking, credit card or a debit card. You can then use the money for all your transactions like paying your electricity bills, mobile refills, restaurant bills, petrol pump bills or any grocery bills. Some of the popular digital wallets are Paytm, Freecharge, Mobiwik, Payumoney, Citruswallet and Airtelmoney etc.

Today, traders and merchants are using more and more technology to enhance their business prospects. All you need is a smartphone with an internet connection. You need to download the digital wallet app onto your smartphone, which is usually free. Next you need to sign up using your email id or your phone number. Your unique id is then created.

Now, when you want to make a payment at a grocery store or at a medical store, all you need is scan the merchants QR code using the Smartphone camera and pay your bill.

Pay online using net banking, debit card and credit card

Making cashless payments through net banking, debit cards or credit cards is one of the easiest and trouble free methods of making payments. It is easy as the debit and the credit happens at the same time, between the customer and the merchant.

Electronic transfer of funds is one of the most effective ways of transferring money. It saves you the trouble of issuing cheques and physically depositing cheques in the bank.

Three primary ways of making online payments: 

National Electronic Fund transfer (NEFT)

For NEFT, there is no maximum limit, but the amount is transferred in batches, during banking hours.

Real-time gross settlement (RTGS)

RTGS are high value transactions, starting from 2 lakhs and above.

Immediate payment services. (IMPS)

In IMPS, the money gets transferred immediately and the service is available 24/7.

In all of the above cases, you need to know the transfer limit per day, specific cut off times in the day and the associated service charges. Some of these services are not available on bank holidays.

However while transacting on-line, there are some precautions you need to keep in mind:

  • Make sure that your internet connection is secure.
  • Check the site privacy and ensure that the security software is in place.
  • Give very little information. Avoid giving detailed information on the site.
  • Use strong passwords that cannot be breached easily.
  • Avoid using public computers for making online payments. The cache on the computer saves the information and thus it can be wrongly used by the next person using the computer.
  • Check your bank or card statements regularly to know the exact amount of money spent.
  • Be vigilant while doing transactions via the smart phone as they do not have extra antivirus software or additional security measures.
  • Install a phishing filter. This will warn you against a “non- trustworthy” site.

These are some of the important things that must be kept in mind when doing cashless transactions.

We have also written another article about How to make payments via Credit Cards in India, please feel free to check it out.

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