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> > Rs 500, Rs 1,000 notes are illegal from today: Tech industry calls it a significant step towards 'cashless economy'

Rs 500, Rs 1,000 notes are illegal from today: Tech industry calls it a significant step towards ‘cashless economy’

PM Narendra Modi has banned the use of Rs 500 and Rs 1,000 notes in the country, and the tech industry has welcomed the bold move.

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Last night in a bold move Prime Minister Narendra Modi made the use of Rs 500 and Rs 1,000 notes illegal. Modi called this move necessary in order to fight the ‘disease of black money’. While the announcement received mixed reactions by citizens on social media, the tech industry has unanimously welcomed the move. Besides fighting the scourge of black money, banning of these large denomination notes will encourage citizens to move towards cashless payment options. This is in line with PM Modi’s vision of a Digital India.

Commenting on this announcement, Ola CEO and co-founder Bhavish Aggarwal said, “We welcome this landmark move by the honorable Prime Minister. As a nation, this is our first major step towards a cashless economy, bringing convenience and transparency for every Indian. This move is integral in realizing our shared vision of a Digital India.” “During the changeover period of phasing out old currency notes we really believe that a lot of people will move towards digital payments options due to curbs on roll out of new currency.  A big chunk of population will move towards digital payments not out of choice but perforce with this bold move by Mr Modi,” Rahul Gochhwal, Co-founder, Trupay said.

Nasscom too has welcomed the move saying, “This move will also accelerate the push toward electronic payment, which presently has relatively little penetration in India, where cash accounts for 78 percent of all transactions by value according to the Reserve Bank of India.” The industry body further claims that this move will have a positive effect on the country’s e-commerce industry where cash on delivery (COD) remains a preferred mode of transaction. “This is also a welcome move for the e-commerce industry, where a large number of deliveries in India are “COD” or cash on delivery, raising logistics costs and risks. While other reasons for use of cash, such as trust, may take longer to alleviate, the present announcement could mitigate a significant factor driving COD: the availability of unaccounted cash,” Nasscom said.

Snapdeal CEO and co-founder Kunal Bahl too reacted on similar lines saying, “We welcome the Government’s bold and courageous move to weed out black money, which will have significant long term benefits for the economy. With this, the quantum of India’s economy moving through the digital pipes will witness massive growth. Both Snapdeal and FreeCharge are committed to supporting all such initiatives.”

With notes being demonetized, one of the services that is expected to see a lot of growth is Paytm, and it is little wonder that founder and CEO Vijay Shekhar Sharma positively reacted to Modi’s announcement. Sharma took to Twitter to express his views.

Welcome to truest digital cash India. Now proud sponsor @narendramodi #PaytmKaro !

— Vijay Shekhar (@vijayshekhar) November 8, 2016

Though most reactions are positive, Nasscom did say that the introduction of new Rs 2,000 and Rs 500 notes is a step back. “The new Rs 2,000 note and the plan to reintroduce the Rs 500 note could be a potential dampener to the bold and progressive step by the government, as high value currency notes constitute the foundation of black money and the cash economy, and are often used for criminal activities.”

Post Modi’s announcement last night, citizens took to social media to express their views on the banning on the Rs 500 and Rs 1,000 notes. While most lauded the bold move, there were some that didn’t take too kindly to the suddenness of the entire scenario. Many complained about the banks being shut immediately after the announcements, and there were photos of long queues outside ATMs till late at night. ALSO READ: Rs 500, Rs 1,000 notes now illegal says PM Narendra Modi, citizens react on social media