The government may disagree, but the nation is witnessing a state of undeclared financial emergency that has, apart from demonetising high-value legal tenders controlling over 65 per cent of the money supply with the public in normal times, nearly prevented people from withdrawing their own savings with banks as per needs. Small trade has come to a near standstill situation for want of regular supplies of cash. Construction and other daily contract workers have mostly lost their jobs. The sad state of affairs will continue until the cash situation improves. The economic growth rate has suddenly nosedived. The situation is being continuously monitored by the government and the Reserve Bank without much visible improvement. The digital commerce may have increased to some extent, but it concerns only a small section of the society, encompassing the rich and the middle class. Ironically, the operators of India’s trillion-dollar-plus parallel economy, a key target of demonetisation, seems to be the least perturbed. Nor are those, who consumed nearly half-a-trillion dollar worth imported gold over the last ten years.
For the first time, the poor-and-low-income group, which represents over 70 per cent of India’s 1.3-billion population force, has gone totally out of their wits. Their money is not safe either with them or with banks. Little that they can do to act against cyber theft of their bank accounts. The police refuse FIRs. Detective departments are hardly equipped to address the grievances of people. The encryption policy and practices are weak. Agonies and stress hopelessly grip the ill-fated account holders as they are made to run from pillar to post for financial justice. The government, forcing digital transactions, holds no guarantee against digital fraud. During the current fiscal year, banks sold on payment of billions of rupees some millions of numbers of credit cards to the public. Soon after, insurance agents linked with those banks chased the credit card holders to make additional billions of rupees to get their cards insured without holding any legally valid assurance against hacking or losses caused by cyber thieves. The credit card insurance has grown into a racket proportion with both banks and insurance regulatory authorities washing their hands off the matter.
Fortunately for the government, there has been little serious resistance from the common man, the biggest sufferer, to its action despite the persistent noise being created by most opposition parties since November 9. The just concluded sine die winter session of Parliament may have been washed out as a result of Opposition protests, it helped the government manage to get all prospects of a debate in Parliament on the vexed demonetisation issue thoughtfully junked, only to avoid getting trapped in uneasy response probably. The next budget session is almost a month-and-a-half away. The Prime Minister and the Finance Minister are somewhat hopeful that the ongoing cash crisis will be noticeably eased by February 1. They may be right. After all, the Indian society is probably the world’s most tolerant society. The tenets of communism failed to stir the mind of those who die uncared of starvation, malnutrition, social, and economic deprivation in the world’s biggest home of the poor. For nearly 70 years since its political Independence, the Indian society has tolerated economic injustice, mocking at the so-called fundamental right to live in the absence of the right to food, the right to shelter, the right to universal education, the right to health, right to employment, and right to social security at the old age. The small-moneyed majority may not mind staying cash-starved for some more weeks.
However, the generally Gandhian non-violent middle class and their a tad below aspiring lower-middle class version are more worried about cash shortage and the government’s going all out to enforce digital transactions, phone banking and credit card payments. Fear is increasingly looming large in the minds of the people being induced to accept such practices if their money in banks would remain safe. The news of growing bank account hacking is simply scary. The automatic disbursement of funds from bank accounts to public utilities, post-paid telecom companies, municipal and other tax authorities will guarantee little protection against absurdly inflated bills and claims, even if they are unintended and infrequent. As it is, fixed deposits (FDs) with banks are hardly secured beyond Rs. One lakh. Credit cards are often linked with FDs with card-issuing banks. Just a month before the government announced selective demonetisation, some 32 lakh debit cards of various banks were believed to have been affected by malware or suspected security breach. Most of the hacked cards reportedly belonged to the country’s top three banks — SBI, ICICI Bank and HDFC Bank. The malware-affected cards were blocked in what is being described as the country’s biggest ever card blocking and reissuing exercise.
The government and those champions of plastic money and digital wallets seem to be the least concerned about the country’s lack of technological preparation to support a vibrant digital economy and commerce in the absence of a strong encryption policy. Only recently, an IPS officer in Maharashtra, who is also known as an IT expert, warned the government that the country needed a strong encryption policy before going digital in a big way. Not many in the government are genuinely concerned. But, the authorities seem to be going on their trip on digitisation and low-cash economy, no matter how well prepared is the system technically to ensure its success. Maybe, some high-ups think if the digital disorder hurts the common man, for the time being, let it. After all, smartphones and digital transactions are not meant for uneducated, unsmart people!
(The views expressed are strictly personal.)