This year's Vishu has just passed.
I remember that as a child growing up in Kerala, the days leading to Vishu (the Hindu New year celebrated in Kerala and few other parts in India) were the most awaited and also the most exciting. For around the corner was impending happiness arriving in the form of the Vishu Kaineetam. From time immemorial, on Vishu, all elders in the family give Vishu Kaineetam to those younger in age, usually in the form of new coins. In olden days, it used to be a major event that required micro-level financial planning for a kid. I still recall maintaining a scrapbook where I jotted down estimated collection (including the potential targets), the collection of the previous year, any new targets, end use of money etc. To quote from a Bryan Adam's song, "Those were the best days of my life."
Let's cut to the present - the situation in today's Digital India. I wonder how this payment/ receipt that is made predominately in cash ended up being handled post demonetisation? We did not receive an email or SMS from the Government on how we were supposed to handle this 'difficult situation' of transacting in cash. Even today, there is no circular from the Government on how to make and receive Vishu Kaineetam.
Post the attempt to usher in a less cash dependent India, I was wondering whether someone will come up with a regulation to handle Vishu Cash payments too. My thoughts ran wild as I ended up drawing an imaginary circular from the Government to control the menace of black money that could arise through the traditional Vishu Kaineetam ritual. It will perhaps read like this…
This imaginary circular will be aimed at curtailing the menace of black money being generated, circulated and laundered through the age-old tradition of Vishu Kaineetam. Here is how it will possibly go:
An individual is entitled to give Vishu Kaineetam of maximum Rs 500/- per person with an aggregate limit of Rs 5000/- to all persons.
The Vishu Kaineetam can only be paid during two days starting from the day before Vishu.
Any payment in excess of Rs 300/- per person should be paid through net banking or digitally using PAYTM, BHIM etc. or such other digital payment modes to be notified by the Government in this regard.
Vishu Kaineetam can be given only to close Relatives. For this purpose, relatives will be the donor's spouse, sisters, brothers, father, mother, daughter and son.
Remittance from abroad towards Vishu Kaineetam should be made through proper banking channels and should comply with the conditions laid down by Reserve Bank of India in this regard including the reporting requirements stipulated therein.
Within seven working days of Vishu, every Donor who has made payment in cash towards Vishu Kaineetam and every recipient should report the transactions online in the attached format quoting the PAN number, Aadhar Number of the recipient and payee.
Vishu Kainettam to any persons who does not have PAN / Aadhar will not be permitted. However, Vishu Kaineetam to kids below the age of 3 will not require Aadhar or PAN and for such payments, the Aadhar/ PAN details of the parent or guardian to be quoted while reporting online.
The Government reserves the right to amend the contents of this circular without any notice whatsoever…
This could be a never-ending list. So, let me pause here!
But trust me Bankers have already sensed some business here as this article proves.
While I agree that I may be going overboard with this, take a moment to think about it. Aren't we living in a situation like this now? Nothing surprises us anymore.
I was just using the festival atmosphere that most of us have emerged from to dwell on issues, which are troubling me, and I believe, the middle class too recently.
The age-old tradition of milking the same cow continues with restriction after restriction being imposed on the middle class while the lower strata of the society and the upper strata are relatively insulated.
While I appreciate and applaud the bold move of demonetisation, the way in which it was rolled out is quite amusing. What started off as a fight against black money, counterfeit currency and containing militancy, took different narratives over a period of time and now rests at 'Making India Cashless'.
I firmly believe that the whole exercise badly managed and it is only a question of time before the flaws emerge, if they haven't already. For e.g., bye-elections cancelled due to cash-for-vote scam in one place and postponed due to militancy in another. Demonetisation was said to strike both at black money and funding for the militants. Where did the money that runs into crores and which was talked about during the cash-for-vote scam emerge from if the system had been cleansed? How did the politicians find so much cash in new notes?
Another development, which didn't make any sense to me, was the farmer loan write-off. While I do respect and understand the trouble the farmers are going through, isn't it a crime to write off Rs 30000-crore-plus of loans without any diligence. I am sure other governments will follow suit and the middle class will bear the brunt. The people who are repaying loans (including the farmers who repaid) now seem to be fools. What is the incentive for the honest borrowers? I take the liberty to borrow the Hon'ble Reserve Bank of India Governor Urjit Patel's view here. He has gone on record to say, "The populist farm loan waiver program set to be rolled out across Uttar Pradesh poses another risk for inflation, undermines an honest credit culture."
On one hand, you are squeezing every penny out of the predominantly salaried middle-class. On the other hand, you are writing off huge loans of many, rich farmers included. What economic sense does this make?
Then there is the obnoxious power given to the Banks. Banks - Private and Public - are given a free hand to squeeze money from customers by way of minimum balance requirement, transaction charges beyond x number of transactions etc. If the intention is to bring more people into the banking fold, this just doesn't add up!
This list of grievances will go on and on, so I would prefer to stop at these. Having said that, I had and will continue to support the initiatives to curb black money and revive the economy. But the lackadaisical manner in which these are being done with no tangible result in sight really pains me. We are constantly living in the world of promises and, sadly, we are getting used to it. Where are the real Achhe Dins?