Hi Friends,

Even as I launch this today ( my 80th Birthday ), I realize that there is yet so much to say and do. There is just no time to look back, no time to wonder,"Will anyone read these pages?"

With regards,
Hemen Parekh
27 June 2013

Now as I approach my 90th birthday ( 27 June 2023 ) , I invite you to visit my Digital Avatar ( www.hemenparekh.ai ) – and continue chatting with me , even when I am no more here physically

Monday, 28 August 2017

Three Sides of the Triangle



First  Side :


An expert committee on household finances , commissioned by RBI and chaired by Tarun Ramdorai , made following observations :


·         Indians have a globally high 95 % of their wealth parked in physical assets ( 77 % in property , 7 % in durables and 11 % in gold ), with only 5 % in financial products


·         Focussed as they are on property investments, very few Indians are investing towards retirement , with 77 % of the households failing to plan for pensions



·         Even with vastly improved access to financial products under the PM Jan Dhan Yojana, savers shy away from financial products due to the high transaction costs, their own unpredictable income streams and lack of trust . Most household lean on informal sources for emergency loans at high costs

=======================================================


SECOND  SIDE :


Times of India ( 28 Aug ) carries following report :

You may soon need to shell out less if you pay digitally


The government is looking at giving a 2 % incentive – over the applicable GST tax rate – in case of digital payments where the bill is up to Rs 2,000 , in a move aimed at discouraging cash payments


The idea is to incentivize all kinds of digital payments , especially smaller transactions , in line with the government’s plan of making India , a less cash economy


The source said the relief is being mooted for “ smaller transactions “ as these are large in numbers and are mostly preferred through the cash mode


Transactions of up to Rs 2,000 are very high in volume and if an incentive can be given here, it will provide an impetus to digital payments while also facilitating the entry of more people within the formal economy




THIRD  SIDE  :


It is indeed heartening to know that the Government is “ considering “ , a suggestion that I made 2 years ago ( and sent to the Policy Makers as email ), in my blog :





After 50 years of introduction of various PENSION SCHEMES ( public + private ) , we have managed to provide cover to ( approx. ) 122 Lakh subscribers of NPS / APY ( by March 2016 ) , of which , some 84 Lakh are employed in Industries / Businesses


But some 50 crore of our Citizens ( employed + self-employed ) have NO PENSION COVER , what-so-ever !


That made me suggest { 31  Aug  2015  } ,

launching of   JanDhan Sarjan Yojana 

 ( People's Wealth Creation Scheme ) as follows :




*   If GST is going to be ( say ) 20 % , Government will transfer from this ,
     2 % ( ie 10 % of that 20 % ) , to the PPF account of the Consumer /
     Buyer , who pays for the Goods / Services purchased , using a RuPay
     Card or a " Mobile Wallet " app



     This will motivate millions of self - employed to open  PPF  accounts  !



*   Since interest from a PPF account is tax-free , every citizen would , now
     want to make all payments thru RuPay card or a Mobile Wallet App



*   RuPay cards are already tied up with accounts opened under Jan Dhan
     Yojana



*   Mobile Wallets Apps will also get tied-up with thousands of branches of
     Payment Banks , which will open in next 18 months



     Just imagine the number of new accounts that will get opened in the
     1,55,000 + post offices of India Post  !



*   In this way , Social Security will become " Self Financing " !



*   Currently , in India , some 97 % of all payments are " Cash Payments ".
     With introduction of this proposal , these will drastically decline



*   Any payment made , using RuPay card or a Mobile Wallet App , will make
     available to the Income Tax Department , full digitized record of each
     such transaction , including :


     *    Who  made the payment

     *    To whom was that payment made

     *    When was that payment made

     *    For what purchase , was that payment made

     *    What was the amount paid



*   One , very desirable consequence of  Jan Dhan Sarjan Yojana
     will be that our " Domestic Savings Rate " will climb back to 30 % !


      In turn , this will help us wither global economic crisis , much better  !




Dear Shri  Arun  Jaitleyji :



My suggestion provides an opportunity to rapidly move towards a “ Less Cash Economy



And , please do not worry about the fact that those 50 crore Indians do NOT have a PPF account ( to enable transfer of that 2 % incentive )



Our ICT ( HW / SW ) geeks are quite capable of ensuring that Jan Dhan Sarjan Software will create such an account AUTOMATICALLY / INSTANTLY , in the name of each citizen making a DIGITAL PAYMENT



And know what ?


With this in place , you would have created a PLATORM for future introduction of UNIVERSAL  BASIC  INCOME  !


 
Please , do not let this “ Once – in – a – Life Time “ opportunity slip away !




29  Aug  2017






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