How to save Nation’s Economy from impending disruption.
For whom so ever interested.
AUTHOR: P Abraham Paul. Dated June 5 2017
I wrote “Exclusively Banked Universal Money Management using Phones (acronym ‘Money through Mobile’ mTm) in a comprehensive paper covering almost all aspects related to it as early as 1996 when no one has heard of these.
The technology adaptation was based on the feature USSD (Unstructured Supplementary Service DATA) in modern form of Signalling CCS7 in Telecom systems in PSTN as well as in PLMN. (I am the first one to implement IN based Prepaid service in GSM and the Mobile Wallet Facility in India in end of 1995)
I got it tested out using USSD, and the many features, products & services as detailed in my paper in the link: wp.me/p1ZsI2-4g
Visualising the need of having a uniform structure, applications & methods for it to succeed, and also needed Government’s role in its regulatory requirements to overcome its disruptive potentials on nation’s economy, I did not venture to do it myself then and I had been writing to Government , RBI, Planning Commission on this and many other areas such as the need of UUID, Exclusive Government owned Communication systems, networks and transport and the Connectivity issues, availability and readiness of required minimum Eco system and so on and so forth; for it to take off. (Available in papaulsblogs in wordpress.com in the link wp.me/p1ZsI2-dh)
The main object being Inclusive Growth through Financial Inclusion, in a country like India with its most population residing in Rural areas, it is going to take considerable effort, time and money. But then there is nothing known as ‘Perfect’ in planning, wait for it and nothing happens.
The way to go is to use best of the Contemporary and move on always with an eye on the future, beginning from Cities, Towns and in places where required eco system readily available and then move on to other areas.
This is what many Private e-business Companies do, with least concern of its main object of realising Inclusive growth by Financial Inclusion is being achieved wholesome or not.
But then Government stepped in with its Financial Inclusion idea PMJDY with good intentions but its success can’t be ensured through regular Banks that are mostly White Elephants; never be able to cater to the needs of huge population of poor and most among them still below poverty line.
In my paper Exclusively Banked Universal Money Management for Inclusive Growth I had suggested the following solutions:
1. Create Payment Banks that include Post Offices network, and its franchisees closer to people in every Panchayat, that can create large number of jobs.
2. Provide Access and connectivity to the zonal mTm system via GPS from Remote rural areas.
3. Create and use UUID for KYC and personal identification for all sorts of money transactions including DBT etc without the need of Phones.
4. Uniform mode of Money transaction and Systems & Procedures at every POS.
Things started happening, thanks to Sri. Nandan Nilekani for creating Aadhar, and thanks to RBI / NPCI for bringing in UPI and creation of Consortium of Banks.
But due to the absence of regulatory part that was critical, many Private Banks and Private e-Money businesses came into the scene exploiting the policy vacuum and started guzzling in and pocketing huge amount of ‘Real’ and Legal money (physical & in instruments) and giving out their own self created ‘money in Virtual form’ (Money as Data) that has no legal status, draining Banks & Liquidity, taking advantage of the lapse in regulative mechanism in place.
It is only common sense to visualise that entire Money in circulation in Banks and being newly released by RBI will vanish in no time from the Country leaving a black hole of parallel economy of illegal Money in virtual form, owned by none.
Seeing that Government and RBI were appeared clueless of what was happening, I wrote to RBI and Government and to different Media, about the need of their urgent intervention, as can be seen in my blog site papaulsblog
In my presentations on ‘Power and Perils of Money going Virtual and the urgent need to regulate it. wp.me/p1ZsI2-Ku I had explained how Money going Virtual is disruptive but also is powerful in many ways if it is properly harnessed.
Converting the disruptive potential as advantage is the way to go, to quicken Inclusive Growth and more, that can be realised by ensuring and retaining Money in its virtual form also legal tender.
This can be done only by making RBI the sole Creator, Custodian, Operator, Regulator and Controller of all forms of Money that includes Money in Virtual form also and banning all others as counterfeit and illegal.
It is therefore, I urged RBI to create exclusive Payment Banks under the Control of Government identical to the Post Offices. Thanks to Sri Raghuram Rajan for approving payment banks (too many though) that included the POs also as his parting gift. Those payment banks are supposed to work under a regulatory mechanism keeping the Money Chain, both in its ‘Real & Virtual’ forms and the Liquidity safe within the Government approved Banks that includes the consortium of Banks formed at the initiative if NPCI, but with no authority to create any form of Virtual Money and e-wallets of its own or to use any of these created by fast mushrooming Private e-money companies.
Unfortunately Government in great hurry to move over to #Digitalisation, was virtually leading the Country’s Economy to disruption by allowing and encouraging Payments using fast mushrooming Private e-money Businesses, Debit Cards etc., defeating the primary object. This also increased hardship caused by Demonitisation as these Companies sucked in whatever Real Money and liquidity left out after Demonitisation.
It is highlighting these dangers and suggesting simple and workable solutions to overcome those, I have been writing to everyone in the Government, RBI, Print & Visual Media, about what could be done, not only to escape the danger of nation’s economy getting badly disrupted but also about how to convert the disruptive potential of Money Going Virtual it as Advantage Government & Advantage People, Legal Banking Industry in my blog “Inclusive Growth, #DigitalMoney anywhere any time, Eradication of Corrupion/Black Money, and better restraint on terrorism – all in one go.
Please see my blog in the link wp.me/p1ZsI2-XG how every transaction of Money in the country, Virtual to virtual, Virtual to Real and vice versa can happen only through RBI, ensuring entire statistics available for management and control of Money both Real & Virtual and its movements. and Liquidity position.
As every transaction becoming transparent, it will help to eradicate Corruption and Black Money and prevent Money flowing into wrong hands and for wrong purposes, the one and only sure shot way to restrain its growth.
TAX free INDIA.
Harnessing the Power of Money gone Virtual everywhere and for everything, give opportunity for Governments to generate enough revenue for its needs by levying a small percentage on every amount of money being transacted; a bye product and BONUS that can make India a TAX FREE Nation, by discarding all current forms of Taxations; Direct and else, GST etc. that are archaic in the Technology world.
I am sure that Government will be able to enhance its revenue at least by ten fold by moving over and Operate Money as Commodity as suggested herein.
The system’s and its functioning being envisaged as parameter driven, all sorts of flexibilities could be built in to enable differentiated charging of levies based on Users ID, place and nature of use, Country’s economic situation time to time such as severe Floods/Draught major natural calamities etc.
New technologies in Crypto Currency, advance Block Chain Technology etc., can be developed and used as tools that India is fully capable of. The Object and Concepts to attain it are important; for adding ‘nuts and bolts’ there are aplenty out there and many fathers later to own it, when done. Government should Indian IT companies to focus and concentrate more on programs helping Country’s progress other than creating NPAs and scoot.
Universal adaptation of the concepts. UGOMAC
The Concept embedded can be adopted Universally in Countries across the World as explained in my paper ‘Universally Governments Operate Money as a Commodity’ #UGOMAC in the link wp.me/p1ZsI2-Yn Further the system proposed envisage handling money transaction in any international currency and pave the path towards uniform practice of open Money management across the World.
Jumping into Digital India before its prerequisites in place is disastrous.
Everyone in Government and in its Party these days vociferous about going Digital, in place and else and knowing anything about it or else.
Jumping into #DigitalIndia without its prerequisites made ready in a war footing basis will be disastrous if not suicidal. Therefore, the whole thing shall be approached in well planned manner phase by phase implementing it in Cities, Towns and its suburbs where eco system needed is readily available and moving on to other areas as and when it is made ready, as explained in my blog. wp.me/p1ZsI2-J5
NO ROCKET SCIENCE; MERE COMMON SENSE, SANS JARGONS.
Please see my other posts in papaulsblog.wordpress.com free for anyone to take and use.
Abraham Paul P.
Freelance ICT/ICN Consultant
Currently in Melbourne