Rahul, a 37-year-old shopkeeper from a small town, used to keep his leather wallet. Whatever he wanted to buy, he always paid in cash. No one could ever notice how much he spent, what he liked, or what he brought.
But now, after the demonetization in India in 2016, the demand for online payments has increased; even an autorickshaw driver accepts payment through an online QR code.
So today, Ramesh’s wallet is empty. He brought a sweet from Zomato and immediately saw an advertisement for diabetes medicine.
So now the question in your mind is how a cashless society affects your privacy.
What is a cashless society?
In a cashless society, the majority of payments are received and paid through credit or debit cards, Phonepe, GooglePay, Paypal, Skrill, and many more.
A cashless society doesn’t mean it demolishes physical money, but online payment is the primary method.
You will be surprised to learn that, according to Meetanshi, India has the highest number of real-time mobile transactions, 48.6 billion.
It is expected to increase further. With those statistics, people are now slowly shifting to cashless transactions.
Benefits of a cashless society
1. Convenience and speed
Suppose you’re at a restaurant, and you’re about to pay the bill, but suddenly you realize that you don’t have a wallet. 15 years ago, if you faced this problem, then you had only two options: either call a family member to come up and pay or wash the utensils. Lol!
But now you’re living in the digital era, even if you don’t have a wallet, you can pay the bill through QR code or withdraw money through an ATM with your debit card. It helps you not to carry bulky wallets and the burden of change.
2. Reduced Risk of theft and loss
Till now, many cases of theft have been found where xyz’s money has been stolen by theft, which are in the Cash form.
However, cashless money gives you the leisure to not worry about the money lost unless or until you click the suspicious link, which is very rare these days because the government has opened so many awareness programs to avoid this situation.
With digital money, no one can withdraw it because it is linked to your phone number or email address. So, with the help of two-factor authentication, your money will be secure.
3. Cleaner transactions( protect from germs)
You have heard that many diseases are spread due to unhygienic factors. Physical notes passed through so many hands, and you don’t know which person has what sort of disease. So here, digital money protects you from this.
Sanitizers have come to the market, especially after COVID-19, to clean our hands, so digital money is good here and maintains hygiene.
4. Transparency and reduced corruption
Digital transactions help you track how much money you spend and also act as proof from whoever you receive and pay.
Now the government has also encouraged people to go for online transactions because here they can track your money, and in online transactions, all your money will be regarded as white money.
Based on this, the government can decide how much tax you have to pay, which is good because your taxable income is contributed to society and the defence sector. So, regarding this, there is no chance of corruption because the government will track your money status.
5. Boosts the economy
If there are digital transactions, then businesses like e-commerce will get a boost, and that money will directly boost the economy, as later the employer will have to pay the tax.
Moreover, it increases the circulation of money, where you don’t have to stay in banks to pay someone who lives far away.
Moreover, it helps rural people to access the mobile app, as it happens that every village has a bank, and some do not. Here, online banking comes in handy, where you can receive and make payments within minutes without waiting in a long queue.
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Dark side: How does a cashless society affect your privacy?
Till now, you have read the praises of Digital transactions and how they change the lives of common people and give comfort. But every coin has two sides that you should know.
Let’s know how online transactions can hurt your privacy.
1. Every transaction leaves a clue
When you purchase anything and you pay the payment in cash, then no one knows who pays. Unless the CCTV camera won’t record you. But when you buy a thing with an online transaction, then you will be tracked to an extent that you won’t believe.
The following details are stored:
- What you brought
- Why you brought
- Have you researched on Google before buying
- Have you seen any advertisement
- From whom do you bring
- How much do you spend
So these details of yours will be stored, and they might be used for advertisement purposes later on.
2. Companies know too much about you
I won’t be wrong if I say that advertisement knows better than your parents. They will track every activity you do on the Internet.
For example, if you buy frequently Junk food, then you might see a high premium for health insurance, or if you’re engaged in watching sports channels, then you might see advertisements related to joining an Online streaming platform where live matches are shown because they know you are their target audience.
3. Data Breaches and Cybercrime Risks
You know, where there is data, there is a high chance of hacking. According to Hindustan Times, India lost about 1,285,254,802.20 US Dollars ( which is 11,000 crores INR) due to cyber scams.
This happens because your digital payments have your sensitive information, like:
- Bank account details
- UPI ids
- Transaction history
- Mobile numbers
If your payment app or data is hacked, then it’s way worse than your cash being stolen, because hackers will frequently use your data for further theft.
4. Bank server problem
Just imagine, you won’t carry your wallet with you, and now you’re trying to pay with your mobile app, and suddenly it appears that your bank is facing a temporary issue, and your payment won’t be initiated. So in that situation, you will be stuck on what to do.
5. Social and Economic Discrimination
Your spending with digital payments tracks your habits and economic status. For example:
- Someone who is buying premium products through online payment will get better Credit card offer options
- The person with a high net worth of income but not using online transactions won’t be tracked by advertisers, which might be a discrimination because of less activity, and they won’t come to know better offers online. Generally, elderly people come into this category.
- Someone who is not using credit cards too much may get low credit card scores, which will make it difficult for them to get a loan at good interest rates.
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Is it all bad? Not really
You need to think that cashless has many benefits to society, as well as giving you comfort. But on the other hand, I feel there should be a balance between physical and digital money.
Just like Rahul, who can use online payments when he wants to, there should be a backup so that you won’t end up in a situation where you are stuck with a server problem or forget to bring your wallet.
FAQs
Are cashless payments safe to use?
Cashless payments are safe if you use trusted apps. Be sure you don’t share your OTP or CVV with anyone. However, most trusted apps use a biometric lock and two-factor authentication for security purposes.
What if there is a power cut or no Internet?
Some apps have a wallet option to withdraw money and pay the bill. But I advise you to keep some cash with you for emergencies, and it’s better to have both options; otherwise, you will end up embarrassing yourself.
Do older people face problems with online payments?
Some may face problems if they are not used to tech. However, some apps have the facility of voice commands and a user-friendly interface where users can search and make payments easily.
Is going cashless bad for privacy?
Yes, it may be because most digital transactions give information to advertisers, who track your spending, interests, location, behaviour, and demographics. So, if you don’t like to carry cash, make sure to use trusted apps to make your payment.
Conclusion
In conclusion, a cashless society brings comfort, speed, reliability, transparency, and a reduction in corruption. But it also comes with the fear that privacy has been compromised.
I know digital payments are the future, but to make it secure for everyone, awareness and secure apps need to be introduced so that no one faces the loss of money through cybercrime. Advertisements use their information with their permission if they allow it.
