A few feet from a board that proudly proclaims Vondaraguppe village — marked by a few shops on the Bengaluru-Mysuru Highway — to be the first cashless village in Ramanagaram district, Anand, a shopkeeper, asks why he should take a card machine.
“People come here to buy biscuits, soft drinks or tea. Why will anyone use cards for this? It may work in the city, but not in the village,” he says and dismisses the claim that his village is cashless.
Whether it is Vondaraguppe village in Ramanagaram or Channapura in Hassan or nine villages in Mandya district, cash is still king as the much-touted “digital village” announcements have fallen flat a year since demonetisation.
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Nearly 90% of the 2,000-person village have a debit card, and only a few use it to withdraw from an ATM on the highway. Among those holding out is Puttamaru, 50, a silk farmer. “I can’t read, so I won’t even know what the trader is swiping. With cash, I know exactly how much money I have given and how much I am due,” he says. At the ration shops, it is either cash or barter system that determines purchase; while, not one point-of-sale machine has been given to the two provision stores or the local milk collection centre.
Search for debit cards
Far away in the 250-household Channapura village near Holenarsipur, each person has a bank account and a debit card.
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When The Hindu visited the village, residents rushed into homes, enquiring with family members where they had kept the debit cards. “Hardly one or two in the village would have transacted electronically in the past few months,” says Jagadish, a farmer. “These card purchases have additional charges. Now that cash is sufficiently available, we use only cash,” he added.
As a result, Mahesh Gowda, who runs a grocery shop and who was provided a mobile POS machine, says far too few electronic transactions have been registered. On why the concept of digital transactions has not picked up, Girish, a cement merchant, says: “Cash transaction is the best. Why should we lose extra in the name of service charge?”
In Mandya
While mid-2016 saw Chandagalu village in Mandya being declared as the first digital village in the country, eight more were declared in the wake of demonetisation. Cash has since returned to pre-demonetisation levels in the local economy.
Swiping machines at the shops in Chandagalu have accumulated dust, and Mandya Milk Union Ltd. is the only agency that transfers money directly to bank accounts currently. Apart from service charges on electronic transactions, Marijogi Gowda, a gram panchayat member, says that fear that banks will deduct loan instalments directly is seeing farmers withdraw immediately after milk union transfers money to accounts.
Long-term process
While bank managers acknowledge the stuttering of the scheme, they say the digital programme needs to be looked at from a long-term vision.
“We are looking at five years from now. The first phase is only digital literacy, and getting the more educated folks to use mobile banking,” says Avinash Kumar from Bank of Baroda in Vondaraguppe. At Channapura village, bank manager Prathima Kumar says that while cashless transactions have come down, they hoped that awareness camps can reverse the trend.
N.G. Prabhudev, manager, Lead Bank of Mandya (Vijaya Bank), said an expenditure of ₹2.5 lakh was being made to set up free Wi-Fi facilities in each branch to encourage mobile transactions.
(Inputs from Mohit M. Rao in Ramanagaram, Sathish G.T. in Hassan, M.T. Shiva Kumar in Mandya)