Digital digital payment the government is assuring

Digital
transaction becomes a mechanism whereby it can bring more people into tax net and
can control unaccounted money. Good percentage of Indian population does not pay
income tax. Even among those who pay tax many try to indulge in malpractices.  By promoting digital payment the government is
assuring more transparency, accountability and formalizing of businesses.
Government source says demonetization is not to reduce the supply of money in
the market but rather to make a shift from cash payment to digital payments.  The government’s interest in digital economy
has two objectives: first to reduce the burden to meet increasing demand for
paper currency, and second to get more number of people towards tax payment. Digital India will not provide
equal effect but rather divide the country, based on poor and rich, rural and
urban India, educated and uneducated, young and old and so on.

The
development of digital transaction in the globe is not unified because of
varied adoption and acceptance. Master Card advisors have classified countries
into four stages according to their use of digital transactions. They are:
Advanced stage, Tipping point stage, Transitioning stage and Inception stage.
Singapore stands among the advanced countries at 61%, followed by Netherlands
60%. USA among tipping point stage with 45%. Spain in the transition stage with
16%, Japan 14% and China 10%. Inception stage by India and Kenya at 2% each.
The reasons contributing to the growth of digital payments are classified as
macro level issues, informal labor market and large shadow economy. (IUP Journal of Business
StrategyDate: June 1, 2017). 

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Many
points that the combined role of endogenous factors and exogenous factors as
affecting its own country’s e-commerce growth and diffusion and stress upon the
positive effect network externalities in the rapid growth of digital payment
and e-commerce sectors. There are many digital currencies such as Litecoin  Ethereum
(ETH), Zcash (ZEC), Dash, Ripple (XRP), Monero (XMR) etc. Among them, bitcoin
is the most commonly accepted, with more than 12.8 million in circulation.