Rural economy is psychology not ready to accept plastic money, needs training

Meerut, Nov 24 (KNN) India’s cash economy for sure has been massively impacted ever since PM Modi announced on November 8 that Rs 500 and Rs 1000 notes would cease to be legal tender and would have to be deposited in the bank accounts by year end.

Clarity on currency impact on different sectors is unfolding as the days are passing.

Some experts say the move will be beneficial in the long-run but as of now people and especially the ones linked to the rural economy are psychologically not able to accept the cash-less business.

The members of the Partapur Industries Association in Meerut held a meeting in the city today to discuss the impact of demonetization.

During the meeting, the members discussed the various problems being faced by them in doing business without cash and difficulties coming their way in accepting plastic money.

Talking to KNN, Dinesh Singhal, Past President, FISME, said, “Most of the members were of the view that the rural economy was not mentally ready or rather literate enough to accept demonetization. For them business means cash money as they are absolutely not used to plastic money.”

Singhal, who is also a renowned industrialist, said, “After the meeting we realized that the problem is more of psychology.”

For industry as a whole in cities as well, the older generation is not ready to accept the plastic money and e-business, he said adding that literacy is also one of the major concerns.

He revealed that educated people from different sectors lack financial literacy for which some measures can be taken by the government.

The government can educate the students in the colleges and universities who in turn can teach their family members, friends etc about the financial system and bank procedures.

During the meeting the MSMEs also expressed their fear that in future the withdrawal should not go down up to the limit that doing business would get difficult.

Singhal, however, said the entrepreneurs are supporting the move taken by the government to fight black money menace but they hesitate in accepting the plastic money.

The entrepreneurs have urged the government to not levy any charges on online transactions in future too to promote it.

Some entrepreneurs also raised concerns that not paying wages in cash would put additional burden of social security schemes on them.

The credit-hit sector expressed that extra social security loads ESI or PF would put more financial burden on them.

Senior industrialist BS Jain from Meerut Chaired the meeting which was attended by more than twenty MSME entrepreneurs from the Partapur Association. (KNN Bureau)