Before we discuss the topic of Merits and De-Merits of Cashless Economy, with GD point of view, let's understand the topic.

Any economy that depends majorly or entirely on cards, digital transactions and e-wallets is called a cashless economy. In November 2016, PM Narendra Modi took the nation by surprise by announcing demonetization. Most of the currency notes in the country were of no value overnight. The movement was started to cut down the circulation of black money in the society. A lot of debate was done and is still on over this topic.


Merits and De-merits of Cashless Economy



  • The most important benefit is the money that can be saved. Printing of the currency notes also involves money. Paper, ink and other costs are involved in printing the cash which can be saved if we opt for a cashless economy.
  • The property prices will fall. Most of the black money is invested in Real Estate, hence a check on black money will bring the real estate prices to a low.
  • Safety is assured. It is not safe these days to travel with cash but cards and online apps have no such threat.
  • Transparency in transactions will put a restriction on money hoarding and tax evasion.
  • Digital transactions save a lot of time as they can be done within seconds.
  • Businesses can fetch a good customer base even from a far off geographical location as the payment can be done online.



  • Not everyone is tech-savvy. There are still many people in the country who do not operate their bank accounts through an online app.
  • The digital transactions depend on the internet facilities. A big number of Indian population is living in rural areas with less to zero internet facilities. This is where the cashless economy doesn’t hold a strong stand.
  • Hacking and cyber thefts. Anything that’s on the internet is under the threat. How can we be assured of our data being safe online?
  • India’s literacy rate is around 70%, what about the rest 30%. Who will provide them training on how to do the digital transactions? And is it really feasible to teach everyone?
  • Local vendors, small retailers, and many small scale businesses still run on cash payments.