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July 11, 2012

An open letter to the god of wealth!

Posted by Rajashekara V. Maiya (View Profile | View All Posts) at 7:53 AM

Respected one,

David Wolman, who's authored the latest Amazon-topper "The End of Money: Counterfeiters, Preachers, Techies, Dreamers--And the Coming Cashless Society", says there are no unbelievers in the religion of money.  I wonder if he realizes how literally we take his figurative pronouncement.

So, like Wolman, in advocating a move to a cashless society, I'm probably blaspheming. Do, forgive me. But, even You will agree that the avatar - of not-so-crisp-SARS-spreading currency notes and mineral depleting coins - is a little outdated. Not to mention distinctly environment-unfriendly. Permit Your devotee to suggest a cashless makeover that's a little more in keeping with the times.

The thing that's really endearing about this paperless avatar is its multiplicity of options. For instance, by transforming into a no-frills bank account, on the mobile phone, You can now be received by so many more worshippers; we've coined a prosaic but effective term for this happy state - "Financial Inclusion". My country alone is home to approximately one third of the world's unbanked. It's these people, mainly rural inhabitants, who still hold your hard cash image most dear, little realizing how susceptible it is to being stolen and surreptitiously installed at another's altar. Maybe, if you let these devotees know how uncomfortable it was for You to be smothered under their mattresses, or imprisoned inside an airless "gullak" (earthen piggy bank), they might take heed and house You in the liberating environs of a bank account. Some might protest that they would have to spend time and money to travel from their village to the nearest bank branch. Or, that they have neither the documents nor the basic literacy to operate an account. No matter. To them, You can simply reveal Your multi-faceted mobile-based avatar. In Your simplest mobile banking form, You enable even the barely literate Indian located in some far flung outpost, move money easily - to a family member with another mobile account, an impatient creditor or someone he deals with for earning his livelihood. 

Let's move to the cities, where mobile banking is sprouting new wings. Some enterprising companies have struck up a partnership with equally enterprising small time businesses and tradespeople, and banking institutions to enable people deposit physical cash into their bank accounts over the mobile. Even You must admit that this switch from cash to cashless avatar is pretty impressive! 

Mobile and mobile banking have inspired many other trends. A popular mobile avatar, which You must try when in the mood, is mobile remittance. Mobile remittances came as a God-send to unbanked people, especially migrant workers, who could send money home (to another mobile phone, naturally) safely, quickly and directly. It gathered momentum as small time service providers and merchant establishments started to accept these payments as well. From those beginnings, mobile remittances have gone on to assume many forms, the latest being the digital wallet, which saves people like us the inconvenience of queuing up to withdraw cash, carrying it around safely and maintaining painstaking accounts of where it's being spent. The beauty of the digital wallet is that it is able to store even more forms of money than the physical wallet - from cash to credit cards to banking and Facebook accounts (surely, You've heard of it in Your parts of the world?). What's more, there's no need to dig inside various compartments. A quick push of a few buttons and we're done paying, and the expenses neatly filed away inside folders named by expenditure heads. In fact, Near Field Communication technology, in the developed countries where it is available, saves users even this minuscule effort. All they have to do is simply tap their mobile to pay, literally, as they go. 

While on the subject of developed countries, allow me to update You that currency notes and cash are all but disappearing there, because their people have recognized that alternate forms of money have so much more to offer. But in a backhanded tribute of sorts to hard cash, they are now trying to develop digital coins and currencies, which can be exchanged person to person, without the intermediation of banks and their charges, regulatory checks and other tiresome processes.

I sense, O exalted one, that you aren't entirely convinced by my argument. I understand... most people don't like change. Even - or shall I say especially - when it's for the better. You also have genuine concerns about how we will be able to fulfill certain "cash only" transactions, such as a tip for services received, the first gift to a newborn, donations to your places of worship, micro purchases, or all financial exchanges when - God forbid - " the network is down". 

To this, I submit that these issues are mostly in the mind.  I'm sure that when the Lydians first introduced metallic coins around 2,500-2,700 years ago, it must have made the diehard barterers pretty mad. Since then, physical cash changed repeatedly to be produced from less and less valuable materials, but our faith in it didn't diminish. It will be the same with cashless cash.

If You still haven't decided to shun Your cash avatar, then it is my painful duty to tell You about the extent to which it has lost its sheen. Currency notes are notorious germ carriers, so bad, that they had to be quarantined or restricted during an epidemic in China some years ago. Cash also breeds other systemic diseases, such as money laundering, drug dealing and terror financing.  It's both expensive and inconvenient (yes!) to handle. (You've never had to wait while your change was being counted out, have you?) And let's not even get started on the security risks and the business of counterfeiting. Banknotes crumple; they stink of chemicals and God knows what else; and in a foreign country, they simply confuse. And while Your older followers might cherish the solidity of its touch and feel, Generations Y and later feel no such attachment. Indeed their idols happen to be QQ coins, Linden dollars and Airtel Money. Since they are your emerging constituency of worshippers, don't you think, that you must play to the gallery?

Yours most sincerely,
MPIN No. 234100


Interesting article.

Indeed, I remember when vegetables were first starting to be retailed by supermarkets - in my country - it was startling to see getting a receipt being handed out for buying petty things like a single piece of lemon! But eventually, it prevailed.

There is excitement in the air for mobile payments and multiple solutions keep coming up time and again. I am sure these solutions will stabilize and the best few will eventually prevail and become a standard. Most of the gen Y are keeping fingers crossed - even as they keep trying out newer modes of payments - for the mobile wallet to become common place.

- Still without an MPIN.

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