In less than a month of demonetization on 8 November, the village of Ibrahimpur in Siddipet district of Telangana shot to fame for becoming the first ‘cashless’ village in south India. It was the result of some steps the state government had taken for digitization of payments, including a big financial digital literacy drive. Later came the T Wallet, a digital payment wallet for citizens.
While the state information technology (IT) department did concede that paper money had made a comeback in Ibrahimpur and some other villages, a few others have stayed on the “cashless" path.
“Mukhra, a village of just 650 people in Adilabad district, is continuing to use digital wallets for payments. In fact, during the Dussehra festival this year, villagers donated money by scanning QR codes," said Jayesh Ranjan, principal secretary in the state IT department.
According to data from the state government, about 150 villages have become ‘digital payment-enabled’ in the last one year.
Under the state’s financial literacy programmes, 713,540 people were trained to use digital payment methods, 117,908 merchants enabled to accept digital payments in rural areas and 64,970 traders, hawkers and citizens were sensitized through the programme at the mandal and district levels. Madal is a local administrative unit.
The other push for digitization in the state came in the form of the T Wallet, a digital payment app launched in June through which citizens can make payments for any government service.
One of the important things about it was that it is used by the government to transfer remittances to beneficiaries under schemes such as the Mahatma Gandhi National Rural Employment Guarantee Act (MNGREGA).
“It is a bi-directional wallet, where the state can also use it to send benefits to citizens. We consciously decided that we wanted to build an actual wallet, and not one that directs you to private ones. Even those who do not have smartphones can use the T Wallet by authenticating themselves on their feature phones through their Aadhaar numbers. But the biggest thing is that there are no charges for citizens for using it," explained G.T. Venkateshwar Rao, commissioner, Electronic Services Delivery Department.
While the response after the launch of T Wallet in June was encouraging, the number of app users was stagnant for a while.
This prompted the IT department to launch the ‘100K Digithon’ programme in September to increase financial literacy to train citizens to use T Wallet. After that, the number people who use T Wallet has increased to 281,000, Rao said.
According to data from the IT department, after its launch ₹ 35.7 crore has been loaded onto the T Wallet app and ₹ .5 crore of payments have been made.
“Rs24 crore has moved from wallets to bank accounts, and this is also free for citizens unlike private company-run wallets," pointed out Rao.
J. Raja Kishore, assistant vice-president, CSC e-Governance Services India Ltd (under the ministry of communications and information technology) who works with the government of Telangana to promote digital literacy, said intensive training was provided after demonetization to make the rural population digital-literate.
“In Mukhra, for example, the major challenge was that people there feared using technology. So we appointed a ‘digital brother’ and ‘digital sister’ from among the educated youth to help people in using digital payments. Now, everything there is paid through QR codes," explained Kishore. Accepting that some ‘cashless’ villages did go back to using paper money, he said that those like Mukhra are examples of success.
Prior to this, Telangana IT minister K.T. Rama Rao in an interview on 1 June to Mint also said that 400 villages in Telangana were ready to be declared ‘cashless’.