http://money.cnn.com/2017/01/19/technology/india-cash-biometric-payments-davos/index.html
This article reports on how India is planning on switching to biometric payments in the next few years. India has plans to eliminate physical cash and credit cards for their 1.3 billion citizens.
There are far reaching effects with India’s move to a completely digital payment method. The most concerning with moving towards this system relates to its security, the reliability, and implementation. Even though producing counterfeit bills is relatively difficult, producing counterfeit digital money seem to be much easier with a few clicks. With biometrics, there should be concern with how reliable the system is. If the system is down or doesn’t recognize the biometric identifier, people would not be able to trade, which could bring the Indian economy to a halt. Additionally, the sheer size of the Indian population will make this a very difficult system to implement which affects the upkeep of removing and registering new users. It will be interesting to see if India actually pulls through with this project.
According to Hindu news and economic trading sites, around 70% of the population lives in rural areas. It seems reasonable to assume it would be difficult to set up a country-wide biometric payment system without adding lots of technology to less urban areas. Has India put forth a plan for how to integrate this system there? If not then I have to agree with your skepticism about the project.
I think the aftermath of demonetization resulted in pushing the country towards the use of electronic wallets. Many new bank accounts are being opened, mobile wallet payments and other e – payment services saw a surge in users. I agree with the article that during this transition, security is a major concern, biometrics can help prevent some of them.