Digital Society for Jamaica: Lesson from India.

In 2009, India launched Aadhaar. Aadhaar is a bio metric database based on a 12-digit digital identity, authenticated by finger prints and retina scans. It became the largest and most successful IT project ever. As of 2016, 1.1 billion people (95% of the population) had a digital proof of identity. This sounds a lot like the National Identification System proposed by the Jamaican Government, but could the direction India took actually be a nexus or model that Jamaica can use to become a digital society? 

In 2016, India added another component to its digitized system called India Stack. India Stack is a series of secured and connected systems that allow people to store and share personal data such as addresses, bank statements, employment records, and tax filings. This is all accessed, and can be shared, via Aadhaar. India Stack allows citizens to open a bank account or brokerage account, buy a mutual fund, or share medical records anywhere in India with just a fingerprint or retinal scan from Aadhaar. Put simply, India Stack could be the framework for a new digital society.

But can a digital society work in Jamaica?

In comparison to India yes we are smaller, but Income distribution is more unequal India where in 2016 India ranks 2nd as most unequal country in the world where the top 1% own 58.4% of the Nation's wealth. This I believe is a better metric to use in accessing readiness for digital society.The other important information to glean from this is how is the Indian society performing as well as how is the Indian economy dealing with the push towards digitization? 

The top news out of India over the past 12 months has been President Modi’s move to ban 85% of the currency in circulation. Modi’s move to demonetize the country was the action that forced everyone into the new digital system. Since Aadhaar was launched, 270 million bank accounts have been opened in India. A 2015 report from MasterCard found that India was one of the countries least ready to transition to a digital payment system.

If the transition to a digital society can happen in India, where just 2% of transactions were non-cash a few years ago, it can happen anywhere. India Stack could fast-track the move to digital payment systems across the developed world and mark the end of cash. For astute investors, there are also huge investment opportunities in this revolution as new companies arise.

But as a Macroeconomics instructor, if we remove notes in circulation, Using the quantity Theory of money  we would be able to attain economic growth by targeted inflation, which is what the central banks does anyway.  As for Investors, A massive barrier to growth in India has been the number of non-performing loans in its banking system. It this sense, President Modi’s cash ban achieved something very important—it recapitalized India’s banks. Since demonetization, over $80 billion has flowed into the banking system, and markets liked what they saw. Since the beginning of 2017, the Nifty Bank Index, which represents the 12 biggest banks in India, is up over 30%. Telecommunications and technology sectors in India are also likely to see rapid growth in the midst of this transformation.

In Jamaica we already have things like Mobile Payments (GK Mpay, NCB Quisk), there also exists master pass (credit card) and banks are trying to reduce cash transactions. The way forward would be for the largest bank to start facilitating international transactions. Once it becomes easy for Jamaicans to access their money without using cash we'll be well on our way to a digital society. Heck My church even accepts tithe/offering using cards. 

http://www.businessinsider.com/india-might-be-first-cashless-society-2017-6

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