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silambu chapter 1

The document discusses the significant impact of cashless transactions on the financial landscape, highlighting the benefits of efficiency and security while addressing challenges such as infrastructure and digital literacy. It emphasizes the importance of a cashless economy in India for transparency and tax collection, driven by technological advancements and government initiatives post-demonetization. The study aims to analyze the demographic profile of respondents, the impacts and satisfaction levels regarding cashless transactions, and the challenges faced in this transition.

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muthamizh953
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23 views5 pages

silambu chapter 1

The document discusses the significant impact of cashless transactions on the financial landscape, highlighting the benefits of efficiency and security while addressing challenges such as infrastructure and digital literacy. It emphasizes the importance of a cashless economy in India for transparency and tax collection, driven by technological advancements and government initiatives post-demonetization. The study aims to analyze the demographic profile of respondents, the impacts and satisfaction levels regarding cashless transactions, and the challenges faced in this transition.

Uploaded by

muthamizh953
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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CHAPTER-I

INTRODUCTION

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INTRODUCTION

Cashless transactions has drastically changed the financial landscape, affecting


consumers, businesses, and economies globally. This transition to digital payment systems
is fuelled by technological advancements, shifting consumer preferences, and the desire for
greater efficiency in financial transactions. Hence, cashless transactions significantly
redesign commerce and finance, offering numerous benefits like efficiency and security,
while also presenting challenges that must be addressed. As society continues to adapt,
digital payments will play an increasingly vital role in everyday financial interactions.
Digital transactions take precedence over physical cash in a cashless economy. This system,
which is powered by internet transfers, mobile wallets, and credit/debit cards, attempts to
increase financial inclusion, reduce the flow of illicit funds, and streamline financial
procedures.

A cashless economy is crucial for India because it promises increased


transparency, better tax collection, and a stronger digital infrastructure. However, issues
like infrastructure constraints and deficiencies in digital literacy call for a balanced
assessment of its benefits, such as ease and security, versus possible disadvantages, such as
accessibility issues and cyber threats. An ecosystem in which digital transactions have
entirely replaced physical currency is known as a cashless economy. Rather, daily
transactions are conducted through digital channels such digital currencies, debit cards,
credit cards, online banking, mobile wallets, and electronic financial transfers. With the
goals of lowering corruption, increasing transparency, and fostering financial inclusion for
all Indians—especially those living in rural areas—the government has worked hard to
advance this change. India is becoming a cashless economy due to the rise of fintech
companies, quick digitalization, widespread smartphone use, and financial advancements.

The Importance of the Cashless Transaction

Because it makes cross-border transactions simpler, lowers overhead expenses,


encourages a more reliable and effective tax collection system, and boosts economic growth,
a cashless economy is extremely important. It also promotes financial innovation, makes
targeted financial aid possible, and strengthens economic resilience in general.

2
Problem of the Study:

Our payment methods have always changed, and during the COVID-19 pandemic, they
have changed even more quickly. Although the majority of transactions done in stores
remain in cash, they have undergone significant digitization; in fact, their number is steadily
declining, and cash's proportion of overall exchange value is already rather small. Some
people think that a "cashless society" is imminent, which they see as a sign of social
advancement and economic efficiency. For the most part, we can all see benefits from the
growing digitization of payments. They seem more convenient, quicker, and safer, albeit
some adaption would be required. Nowadays, half of those surveyed in the euro region say
they prefer digital payments.

History of Cashless Transaction:

The emergence of financial innovations and the universal acceptance of credit cards
and internet payment methods are the origins of the idea of a cashless economy. But in India,
the 2016 demonetisation campaign was a major factor in hastening the nation's transition to
a cashless economy since individuals were finding it difficult to obtain actual currency from
banks and were instead turning to digital channels for daily transactions. The United
Payments Interface, or UPI, was introduced as a safe and comprehensive free payment
system in India after the demonetization campaign. Additionally, it spearheaded the
expansion of financial technology firms such as Paytm, Phone Pay, and others.

Scope of the study:

Faster adoption of digital payments and banking among unbanked sectors and
behavioral changes would be facilitated by seamless, easy, and secure payment processes.
Increased competition will benefit the environment and give customers more options when
new firms enter the market, each with a somewhat different approach to the market and
different business strategies. The evolving dynamics of the payments sector, which is still
in its infancy in India, will undoubtedly benefit from a bigger pie with more participants.
Only 5% of personal consumption expenditures in India are made with cards; cash still
accounts for the majority of consumption. Thirty to fifty percent of purchases in wealthy

3
nations are made using credit cards. Thus, there is great chance for growth. The
quick development of cell phones and the Internet.

Types of Cashless Transaction:

Mobile wallets, UPI, online banking, NFC-based payments, and QR


code scanning are just a few of the digital payment methods available in a
cashless economy. Every mode accommodates various tastes and needs
while guaranteeing accessibility, security, and ease of use while making
financial transactions.

1. Mobile wallet:
An electronic wallet that can be accessed using a smartphone and serves
as a gateway for payments, doing away with the need for physical cards. T

2. Plastic Money:
A cashless payment mechanism that uses both virtual and physical
debit, credit, and prepaid cards. It minimizes dependency on cash, tracks
history, and decreases the need of paper money.

3. Net Banking:
Uses RTGS, NEFT, or IMPS to move funds between bank accounts.
economical and widely used.

Objective
 To study the demographical profile of the respondents.
 To identify the impacts of cashless transactions.
 To analyse the levels of satisfaction of respondents to ward of cashless
transaction.
 To find out the challenge’s in cashless transactions.

Limitation of the study


 The respondents were not understanding same variable it has been explained.
 The process of consisting information consume time.

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 Same respondents where heighted to give their option.
Fives respondents not disclosed about cashless transaction

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