The move towards cashless economy may be ahead of time, but here’s how you can get started right now.
In a bold move against black money, PM Narendra Modi took everyone by surprise as the government decided to scrap the existing Rs 500 and Rs 1,000 currency notes with new Rs 500 and Rs 2,000 notes. If that wasn’t enough, you won’t be able to use the existing currency notes of the said denomination with immediate effect. Sure, the move aimed at targeting corruption is a master stroke. Eventually, it will also help in encouraging digital payments, while moving the nation to a cashless economy. And as increasing number of people start making electronic payments, even for smallest of things, it will help government to track the cash flow and eventually curb the black money problem. But now that our existing currency notes have become redundant and there’s still some time before new notes start circulating, here’s a guide to go cashless in the meanwhile.
The ATMs are closed for two days and even though banks are going to open tomorrow long queues can be expected and there’s also a limit on how much each person can withdraw in a day. This move can practically get you stranded and cash-strapped, but thanks to the digital age, the number of mobile wallets and smartphones, going cashless for a few days shouldn’t be a big deal. Of course, if you don’t have enough cash, you may not be able to pay at small hotels or restaurants, travel in auto rickshaw, or pay at small joints that don’t accept digital money. But hey, there are always some alternatives. Be it traveling, eating, paying for mobile, electricity, telephone or DTH bill, or booking movie or travel tickets, there’s a lot more you can do without cash.
Travel
Transportation could take a big hit as auto-rickshaw drivers won’t accept Rs 500 and Rs 1,000 notes. Luckily, there are app-based taxi aggregators such as Ola Cabs, Uber and Meru that let you book cab using your smartphone. For some, it may be a little expensive, but the service providers do have their own digital wallets that let you make cashless payments for all your rides. ALSO READ: Amazon, Flipkart stop CoD orders after Rs 500, Rs 1,000 notes abolished
And for those who travel in local trains in Mumbai, there is an app called unreserved ticketing system app (UTS) for Android smartphones that lets you load money in the wallet using credit, debit card or net banking and book an e-ticket for traveling within Mumbai. You can book both first class and second class ticket on all routes – central, western and harbor. ALSO READ: Twitter erupts after crackdown on Rs 500, Rs 1,000 notes; 2,000 tweets sent out per minute
Food
A lot of us eat out and with the existing notes now redundant; it makes one think hard how to cope up for those daily needs. Thankfully, you can order food from apps such as Zomato, Fasos, Box 8 and more and pay using net banking, credit or debit cards. You can also order from Pizza Hut, Dominoes, McDonalds and pay using these your card. For those who want to do grocery shopping, fish and meat, there are apps and websites such as BigBasket and Grofers that deliver vegetables, eggs, bread, biscuits, cooking oil and staples right at your door step. ALSO READ: Paytm app downloads grew by 200% since India demonetized Rs 500, Rs 1,000 notes
Digital wallets
Over the past 3-4 years, the number of digital wallets have increased, with the most prominent ones being Paytm, Freecharge, Mobikwik, PayU money, Citrus Wallet, Vodafone’s mPesa and Airtel’s Airtel Money. These digital wallets allow you to pre-load money using a credit or debit card, or via net banking. Even if you don’t load money, use can use these wallets to make payments for your electricity bills, mobile and landline bills, do a mobile, DTH or data card refill, and a lot more. A lot of food courts in shopping malls have also started accepting money using Paytm and other wallets. You can also pay at petrol pumps using the Paytm wallet. ALSO READ: New Rs 2,000 note does not have a ‘Nano GPS Chip’
Paying to merchants that accept wallet payments is pretty simple. To begin with, you will need a smartphone with internet connection and wallet app installed. You will need to sign up using your email ID or phone number to create an ID. Next, say you go to a grocery store or a medical store and want to pay using digital wallet, you can either enter the merchant code and make payment, of scan the merchant’s QR code using the smartphone camera and pay the bill. ALSO READ: Reliance JioMoney Wallet app first impressions: Good potential, needs design overhaul
UPI
UPI or Unified Payments Interface is the next gen digital wallet that aims to turn our nation into a cashless economy. Built on top of IMPS (Immediate Payment Service), the payment interface eliminates the need of adding payee details such as full name of the recipient, bank name, IFSC code and branch. As of now, UPI has gone live with 21 banks, which includes Axis Bank, Union Bank Of India, UCO Bank, ICICI Bank, Federal Bank, Vijaya Bank, Andhra Bank, Bank of Maharashtra, Karnataka Bank and Canara Bank and more. Then, there is also Flipkart’s PhonePe, and other solutions such as UPI, Reliance Jio’s JioMoney. ALSO READ: Rs 500, Rs 1,000 notes are illegal from today: Tech industry calls it a significant step towards ‘cashless economy’
Unlike other digital wallets, for using UPI you will need a bank account and you phone number linked to it. Download the bank’s UPI-based app, enter your registered phone number and verify the OTP. Next, you’ll need to create a Virtual Payment Address (VPA), which could be something like ‘9820098200@pockets’ or ‘johnsmith@ybl’ and so on. As of now, UPI apps are only available for Android smartphones, with iOS apps expected soon.
Say you want to transfer money to John – you can simply open the app, go to recipient list, enter the VPA, amount and hit send, its that simple. You can click read our detailed step by step guide in setting up UPI, transferring and receiving funds here. Unified Payments Interface: Here’s how to register, send and receive money using UPI apps
Pay using credit / debit cards
Plastic money is one of the best and hassle-free ways of making cashless payments. Whether you are at a restaurant or fast food place such as McDonalds, KFC or Pizza Hut, or at a theatre, a shopping mall or grocery store, you can always pay using a credit or debit card. It saves the hassle of withdrawing money from the ATM or bank and then handing over at the cash counter. As the payment is digital, the money goes directly in the merchant’s bank account, thus also saving their time and hassle of depositing in the bank. A lot of banks also offer prepaid cards where one needs to load money from the bank account, and these cards can be used for shopping and all other purposes.
Electronic funds transfer
The option for electronic funds transfer has been around for quite some time now – it allows you to transfer money from one bank account to the other. However, a lot of people still prefer paying by cash or using a cheque. The electronic funds transfer saves the hassles of issuing a cheque or physically visiting the bank. There are three types of options available – national electronic funds transfer (NEFT), immediate payment service (IMPS) and real-time gross settlement (RTGS). NEFT does not have any transfer limit, but there are specific cut off times on when you can send money using this medium. Also, it does not work on bank holidays. Charges per transaction are somewhere between Rs 5 and Rs 25, depending on the amount. Money is transferred into recipient’s account within 24 working hours. ALSO READ: Rs 500, Rs 1,000 notes now illegal says PM Narendra Modi, citizens react on social media
The RTGS option lets you make high value transactions, with amount starting Rs 2 lakh and upwards. The settlement happens in real time and charges per transaction range between Rs 30 to Rs 55. Lastly, there is IMPS which is available 24 hours a day, seven days a week and 365 days a year. The money is credited into recipient’s account almost instantly, and maximum 15 minutes. While charges range between Rs 5 to Rs 15 per transaction, you can send maximum of Rs 2 lakh per transaction.