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18
September 2017
 |
Finance Minister Arun Jaitley (The Total Investment & Insurance
Solutions)
Increase
in volume of digital transactions, widening of tax base and squeezed
circulation of high denomination currency were the real measures of success of
demonetisation, Finance Minister Arun Jaitley said on Monday.
The
success of the November 2016 note ban came under attack after the Reserve Bank
of India (RBI) revealed that almost 99 per cent of the banned currency had
returned to the banks. The Total Investment
& Insurance Solutions
"Some
circles have lack of understanding and measure success of demonetisation with
only how much money reached banks," Jaitley said here at the launch of
Google's new digital payment app -- Tez.
"I
have three red lines to measure success of demonetisation. First, how much
volume of cash that RBI prints are we able to squeeze over time. High
denomination currency has already squeezed in terms of volume.
"Second
test is that as its (demonetisation's) consequence, how many assessees are we
able to add and expand tax base."
The
third measure would be the increase in digital transaction volumes, he added. The Total Investment & Insurance Solutions
These
three would remain the test of success of demonetisation, which both in the
medium and long term would see an advancement in the positive direction, the
minister stated.
"Lot
of people at that time went for digital payments more as a compulsion rather
than because it was easier. We reached a peak (of digital transactions), then
slipped marginally and now we will pick up again," he said.
He
added that with the technological evolution, the Google's app was perhaps the
simplest way of monetary transactions.
Jaitley
said the Google's new digital payments app over the next few months was likely
to make major advances in digital transaction volumes.
Built
on the Indian government-supported Unified Payments Interface (UPI), Tez allows
users, free of charge, to make small or big payments straight from their bank
accounts. The Total Investment & Insurance
Solutions
The
app was built for India, working on the vast majority of the country's
smartphones and available in English and seven Indian languages (Hindi,
Bengali, Gujarati, Kannada, Marathi, Tamil and Telugu).
The
app works in partnership with four Banks -- Axis Bank, HDFC Bank, ICICI Bank
and State Bank of India -- to facilitate the processing of payments across over
50 UPI-enabled banks. The Total Investment
& Insurance Solutions
Jaitley
said the idea of Tez was discussed by Google's India-born CEO Sundar Pichai in
January, just after demonetisation.
"Google
saw a great potential in Indian economy and businesses," he said.
Jaitley
noted that the need for finding alternatives to high cash was never an issue
seriously debated in the government earlier and the people got in the habit of
living in a high-cash economy with low tax base as a normal practice.
Thus,
demonetisation was a shock, waiting to happen and India had seen the debate
over it evolve, he added.The Total
Investment & Insurance Solutions
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