Better Than Cash Alliance Network: Explained

Introduction

The move towards cashless economy in India has its roots from Jan Dhan Yojana triggered through UN’s Better Than Cash Alliance Network

Background

  • Better than Cash Alliance Network is an initiative of United Nations Capital Development Fund (UNCDF)
  • UNCDF is the secretariat of the alliance based at United Nations
  • It is a partnership of international agencies, companies and countries
  • Alliance is funded by Bill and Melinda Gates foundation, Master card, Citi foundation, Visa, Omidyar network and Ford foundation

Aims and Benefits

  • Aim is to help countries to make a transition to electronic or digital payments
  • Alliance promotes inclusive growth
  • It reduces poverty by helping nations to benefit poor directly
  • The alliance promotes financial inclusion
  • It enhances digital finance
  • Reduce costs for countries
  • Women empowerment
  • Increases transparency levels

Implications for India

  • Better than Cash Alliance fueled the world’s largest financial inclusion system of Jan Dhan Yojana in India
  • Helped open about 180 million accounts in a year accumulating to $3 billion in deposits in India
  • Brought nearly 300 million Indian citizens under formal banking sector in 3 years
  • The financial inclusion along with Aadhar identification will help in identification of beneficiaries to provide subsidies
  • The LPG subsidy is a major success in India through DBT saving $2billion to GOI annually
  • India can enhance its research and technology by joining in the alliance
  • India gained a policy partner through the alliance
  • India is a great case study and success story of Better than cash alliance

Conclusion

  • India has benefited a lot from the alliance in the recent demonetization scenario
  • GOI has partnered with the alliance to make a change to cashless economy 
  • It has improved transparency levels to a great extent by bringing most of the financial transactions under formal banking sector
  • Alliance has given India the required infrastructure and technical expertise to change to a cashless economy
  • The alliance has helped India develop a digital economy
  • Creating awareness and changing the attitude of the Indians from traditional to modern methods is a big challenge
  • India is progressing to a cashless economy despite facing a lot of hurdles and challenges
  • UN Better than cash alliance is an aid to India’s “Digital India” Mission
  • Overall, India is changing with the partnership of the UN Better than cash alliance

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