Demonetisation to push digital economy: Nandan Nilekani
Former Chairman of the Unique Identification Authority of India (UIDAI) Nandan Nilekani has said that Demonetisation would see a massive activation of digitisation of financial services in the country, although there will be some amount of “short term pain” in the coming weeks.
The ex-CEO of Infosys said the “pain” caused by the demonetisation will remain for some more time, but the extent of digitisation that will happen over the next three months now, would have normally taken place in a three-year time frame.
While the infrastructure has been laid down in the last seven years, the demonetisation drive will accelerate the roll out of digital financial services in India supported by Aadhaar, UPI, USSD and micro ATMs, Nilekani told NDTV.
He said that the “need of the hour” was to make payments to merchants cashless. He added that one would see “massive activation” of digitisation in Indian economy. “There will definitely be some amount of short-term pain in the coming weeks. But you will see this acceleration is going to benefit everybody,” he said.
Nilekani gave the example of feature phone owners, who can transact using USSD channel and said this will bring “everybody into the digital system”.
“The more important thing is when the economy becomes formal, when everybody’s financial transactions are digitised …India is going to go from data poor to data rich and that will make it more and more difficult for people to do dishonest things or to be outside the system. You will reduce the amount of black money in the system,” he said.
He expressed hope that the government would increase the number of micro-ATMs in the country to one million from the current 130,000, and said cashless transactions will completely remove bureaucracy from the country.