In the Wake of Demonetisation, Goa Prepares to Become India’s First Cashless State

Goa will become the first state to go cashless, Defence Minister Manohar Parrikar announced at a rally in Sankhali in the state on Nov. 25. “Time has come to go towards a cashless society. We should cooperate with the government,” the Minister said according to Bloomberg Quint. “Cashless society will be achieved in Goa first. We will fulfil the Prime Minister’s request in this regard.”

Cash transactions will not be banned but the government will push hard for the adoption of digital modes of payment across the state, from large transactions to ones involving small vendors.

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On Nov. 26 Parrikar, who has earlier served as the Chief Minister of Goa, met with government officials and personnel from major national and private banks to chalk out a plan to encourage cashless transactions in the state.

Parrikar pointed out that Goans use cards (ATM/credit) in “a big way.” He added that electronic transfers were already being used by the state government to distribute payments under the Dayanand Social Security Scheme (a pension plan).

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Goa’s chief secretary, RK Srivastava, was also present at the meeting. He told the Times of India that Goa has an edge when it comes to cashless dealings because the state is small, with a population of 15 lakh. There are 17 lakh registered mobile connections in the state.

“We have 22 lakh bank accounts, which means that one person has more than one account,” Srivastava was quoted saying.” Most of the people in Goa use debit or credit cards while purchasing and hence it will not be a problem to go cashless.”

Transactions can be made using cards or through mobile banking. Vendors would be assigned Mobile Money Identifier codes when they register at banks. Customers who need to make transactions can dial a designated number (*99#), enter the details of their bank accounts and the amount to be transferred, followed by the MMI code of the vendor. There is no floor limit to the amount of the transaction and no fees would be levied on mobile transactions.

The success of the initiative will depend on how far the government is able to reach out to the traders and liquor vendors in the state. Special attention is being paid to the 10,000 registered liquor vendors and 26,000 registered traders in the state; most of them depend on cash transactions. Awareness drives are being launched on Nov. 28 at Mapusa and Panaji.

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