India's Audacious Plan to Bring Digital Banking to 1.2 Billion People (bloomberg.com) 57
Saritha Rai, reporting for Bloomberg: India is trying to yank its cash-based economy into the 21st century. But how do you get 1.2 billion people, many of whom have never seen a bank or opened an account, to send digital payments to each other? The government's answer is an effort it has named the Unified Payment Interface. Debuting Monday, it's a system designed to make transferring and receiving money as easy as exchanging e-mail or text messages. The goal is to bring banking and financial services to hundreds of millions of citizens, many of them poor and disadvantaged, in one fell swoop. The network was created by India's retail banks and backed by India's central bank -- and they're confident it will work because it's built on top of an even more audacious project: India's biometrics-enabled national ID system, called Aadhaar after the Hindi word for foundation.The idea is to make mobile payments and utilization of other services between users with accounts in different banks frictionless. The Aadhaar number, or a virtual address, will serve as the single identifier. This will also allow a person to use several services of a bank without being its customer, explains Forbes India. The UPI app is in phase-I and is operational for a closed user group. The app is expected to be launched for public in the coming months.
Re:This will be a disaster: (Score:5, Funny)
Re:This will be a disaster: (Score:4, Interesting)
I'm just not sure if it'll be a "Come for the dystopian surveillance; stay to enjoy the fraud!" or the other way around...
The main motivation for this scheme is entitlement reform. In the past, India provided subsidized rice to the poor, and about 80% of the rice was typically stolen before it reached the intended recipients. Under this new system, the poor will have money transferred directly to their e-accounts, so they can then buy rice (or something else that they need) in local markets. So even if there is plenty of fraud, it will still be better than what it replaced. One thing that Indians have plenty of is low expectations.
Public Sanitation (Score:1)
They should do Public Sanitation first.
The majority of people there are still crapping in the bushes.
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Who needs a bank when Indians all work for free?
Or so the person telling me that an H1-B can replace me if I don't tow the line says.
Re: (Score:3, Interesting)
What good does access to digital currency and "financial services" do for anyone but the banks?
Imagine you're an Indian farmer and you take your goods to a buyer. Now you can be paid immediately and electronically, and you won't be robbed as you and your oxe and cart make your 20km journey back to your village.
Imagine you're a woman in India doing piecemeal work. Now you can be paid on your 2G flipphone and your husband can't take your earnings and blow it on liquor.
Imagine you're a worker working
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The amount the banks will "rob" the villager with fees and penalties will outweigh any roadside robberies.
Hey Anonymous Coward, in India, financial services to the poor are largely delivered through the post office.
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and you won't be robbed as you and your oxe and cart make your 20km journey back to your village
It's comforting to know that you won't be captured and held hostage until you transfer the money electronically.
SubjectsInCommentsAreStupid (Score:2)
Will we see end of cash? (Score:4, Insightful)
Wondering if we'll see the end of cash / anonymous / private purchases in our lifetime? I don't want that, but boy are the banks & governments ready to log and track everyone together.
If they've never seen a bank... (Score:3)
Where, pray tell, did these people get the "digital money" from then if they've "never seen a bank" or "opened an account."
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http://theoatmeal.com/comics/exposure
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Not so much, it's a bit more like turning every place you can recharge your phone into a bank deposit/withdrawal counter.
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Re: How about food and water (Score:1)
That is Hank Hill you are talking to sir. He sells propane and propane accessories.
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You think pumping hydrocarbons out of the ground and burning them is a better method? At least with firewood, you're only participating in the short carbon cycle, and not increasing the level of greenhouse gases from a long-term view.
There's only a few ways of cooking, because it requires the use of heat: 1. burning wood, 2. burning fossil fuel, 3. electricity, and maybe 4. concentrated solar power. I guess there's also 5. nuclear fission, but that's rather infeasible, and there's also 6. various other ex
Progress is Great (Score:2, Funny)
Given this is India... (Score:3, Funny)
Excellent (Score:2)
I support this. (Score:2)
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Re: I support this. (Score:1)
If it is truly transparent the public gains more than any individual loses. Imagine seeing every penny that moves between everyone. The people with the most money have the most anonymity to lose.
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A cashless world is Stalin's wet dream.
Traslation (Score:3)
FTFY
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In other words, what the USA has already forced all other countries to do.
In Asia, limited welfare (food, education, health) services means government isn't just oppressive, it is the enemy: So the citizens willfully defraud their own government. Of course, the elected people have the same attitude and control the purse strings; so corruption is endemic. Once again, government is targeting the behaviour of the multitude. For that it needs a permanent, difficult-to-fake identifier for each person. Finge
Frictionless mobile payments? (Score:1)
How about mass surveillance. For the vast majority of purchases I don't see what is wrong with carrying a few dollars (or rupees), compared to your economic freedom.
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Audacious! (Score:2)
The real reason (Score:2)
Yet in America..... (Score:2)
We cant even get banks to transfer money from bank to bank without major difficulty and huge fees. and Simple shit like setting a rule of "1% of all deposits go into a separate account" are impossible here in the USA.
showing an impudent lack of respect (Score:1)
Tranction fees... (Score:2)
Cash: No transaction fees.
Electronic payment: Transaction Fees
Now you know why the banks are interested in pushing electronic payments.
Cash: Anonymous transactions
Electronic Payment: All transactions recorded.
Now you know why government is interested in pushing electronic payments
I hope it's not fell! (Score:2)
The pedant in me needs to point out that the phrase "in one fell swoop" doesn't mean what the author thinks it does. "Fell" in this context means cruel, malevolent, or destructive. I really hope that's not the case here.
Then again, it's being done by banks, so maybe that description really is right.