CHAPTER-1

INTRODUCTION
1.1 INTRODUCTION

Cashless economy is a system where any type of money transactions are done
through digital means like debit card, electronic fund transfer, mobile payment, internet
banking, mobile wallets. this will leave very little scope for flow of hard cash in economy.
Use of technology has permeated in every walk of life. It has brought a sea change in how we
interact with the outer world and even with ourselves in term of our habits and behavior. One
of the important quantifiable aspects of our surrounding has been money

The financial system of any country is one of the most important one consist of banking and
non-banking financial institutions, these institutions are providing various type of financial
services to the customer. It also stimulates business growth. Many business transacted depend
upon it. Every day thousands of CRORE rupees are transacted by the banks. In India most of
bank and financial institutions are offering information and communication technology based
financial product and service to improve their business efficiency and speed of service. ex: e-
banking, electronic money transfer, mobile banking etc.

Hence, to know about peoples attitude towards cashless economy in MALAPPURAM

District, the most largely populated district in KERALA State. Selected Tirur locality
1.2 SIGNIFICANCE OF STUDY

Going cashless not only eases one's life but also helps authenticate and formalize the
transactions that are done. This helps to curb corruption and the flow of black money which
results in an increase of economic growth. The expenditure incurred in printing and
transportation of currency notes is reduced

1.3 SCOPE OF THE STUDY

Many countries are established this system completely. In India it is as emerging trend. It Is
useful to avoid black money and also avoid carrying paper money in wallets while going
outside. At present, the country can’t completely install this system. But the government takes
certain measures to make the economy cashless. Almost all banks provide e- banking
facilities now. The sudden cancellation of 500 and 1000 rupee note in India has evoked the
question of cashless society.

Cashless payment has many advantages it discourages robbery and other cash related crime.
When people opt for other alternative modes of payment, they tend to hold less physical cash
when they shop. Thus, it Eliminate the incentive for robbers to commit cash related crimes.
The purpose of this research is to investigate consumer perception about cashless economy in
tirur locality .the study helps to identify the factors which could affect individual’s decision
of using cashless transactions

1.4 STATEMENT OF THE PROBLEM

The study is entitled as “A STUDY ON PEOPLE’S ATTITUDE TOWARDS CASHLESS

ECONOMY

 To know peoples attitude towards cashless economy

 To know people preference towards different modes of cashless payment
 To study the factors that influence cashless economy
 To know the problem faced by people when using cashless transaction.
1.5 RESEARCH METHODOLOGY

1.6 SOURCE OF DATA

Both primary and secondary data are used this study.

SECONDARY DATA

Secondary data is collected from internet

PRIMARY DATA

Primary data was collected by using structured questionnaire

1.7 TOOL FOR DATA COLLECTION

Well-structured questionnaire was used for data collection

1.8 SAMPLING TECHNIQUE

Convenient sampling method was used in this study

SAMPLE SIZE

100 respondents were selected of the study.

TOOLS FOR DATA ANALYSIS

The tools used for the analysis of data are frequency and percentage analysis

TOOLS FOR DATA PRESENTATION

The data is presented using tables and graphs such as bar diagram, pie diagram etc.

1.10 LIMITATION OF THE STUDY

 The study is confined to a limited number of respondent of tirur locality

 Area of the study is limited to tirur locality
 Sample available are too limited to the generalize the entire population
 There is a chance of concealment of information from the part of the respondent
 CHAPTER-2
REVIEW OF LITERATURE
Oluwadare, et al (2012) assessed the role of ICT in readiness for the implementation
of cashless transaction in Nigeria and identify the challenges associated with the
implementation of the proposed cashless transaction as affecting banks customers.
Questionnaires were used in collecting data on sampled respondent. In addition, data
on the volume of transaction of the alternative payment systems in use in Nigeria was
collected from the central bank of Nigeria.

Muhammad (2012)in an article titled analysis of value creation of electronic banking

habit in Nigeria examined trend of banking habit in Nigeria across banking regimes of
regulation and deregulation hinged on historical perspective of banking development
in Nigeria, from independence to 2012. Relevant secondary data covering 1960 to
2010 were collected from central bank of Nigeria annual reports and analyzed using
the descriptive trend analysis. Muhammad (2012) finding suggests static behavior
across the monetary policy regimes and thus cautioned rushing the cashless program
until measure are in place to encourage and push fast the banking culture changing for
the cashless Nigeria

Ebipanipre&uyoyou, (2013) studied the merits of the cashless economy to the

Nigerian populace and the pains of a cash based economy. Using accidental sampling
method and descriptive statistics and regression and with the chisquare and analysis of
variance (ANOVA)test, their result reveal a positive and significant relationship
between cashless economy and transparency ,accountability and reduction of cash
related fraud . it showed that a cashless economy has a positive impact on economic
development .

John et al (2013) using accidental sampling method on some 500 traders, students and
civil servants through administered; showed that CLP (cashless policy ) increase
employment and reduce cash related robbery there by reducing risk of carrying cash
around .they also reported that CLP also reduce cash related corruption and attract
more foreign investors to the country .it is therefore , a step in the right direction as its
impact will be felt in the modernization of Nigeria payment system, reduction in the
cost of banking services, reduction in high security and safety risks and also card
banking related corruption.
Okoye and Ezejiofor (2013) examined the significant benefits and essential elements
of cashless policy, and the extent to which it can enhance the growth of financial
stability in the country. The descriptive research design was adopted for the study
with a sample size of 68 questionnaires arrived at using the convenience sampling
technique. The data collected was subjected to face validity test, and was tested with
ANOVA and chi – square (x2) technique and the results indicate that: majority of
Nigerians are already aware of the policy and majority agree that the policy will help
fight against corruption/money laundering and reduce the risk of carrying cash. Major
problems envisaged to hamper the implementation of the policy are cyber fraud and
illiteracy. Based on the findings, they recommended that government should adopt a
different strategy to educate the non-literate Nigerians about the cashless economy;
and a framework should be worked out to provide cyber security in Nigeria.
Ebipanipre&Uyoyou, (2013) studied the merits of the Cashless economy to the
Nigerian populace and the pains of a cash-based economy. Using accidental sampling
method and descriptive statistics and regression with the Chi-square

and Analysis of variance (ANOVA) tests, their result reveal a positive and significant
relationship between Cashless economy and transparency, accountability and
reduction of cash-related fraud. It showed that a Cashless economy has a positive
impact on economic development. The research recommended adherence to
minimum-security standards and deployment of more ATMs for smooth
implementation of the CLP in Nigeria.

Osazevbaru and Yomere (2015) explored the benefits and challenges of the cashless
policy vis-à-vis the cash based policy. Specifically, Osazevbaru and Yomere (2015)
seek whether other Point of Sales card acceptance services stakeholders attract a
significant part of banks income in cash-less economy. To address this, secondary data
were collected and content analysis applied in data analysis. After factoring in other
POS stakeholders share of income, the study found banks income higher in cash-less
setting than in cash based arrangement. Thus, the cash-less policy offers immense
benefits to the banking sector (Osazevbaru and Yomere, 2015) concluded.
The study discussed so far in brief highlights the significant benefits and essential
elements of cashless policy and also challenges associated with the implementation.
Based on the result of the above studies the researcher could be able to identify some
important variables related to cashless economy.
 CHAPTER-3
THEORATICAL BACKGROUND
CASHLESS ECONOMY

A cashless economy is a system where any type of money transactions are done
through digital means like debit cards, electronic fund transfer, mobile payments,
internet banking, mobile wallets, and other newly evolved payment channels, this will
leave very little scope for flow of hard cash in economy.

TYPES OF CASHLESS MODES AND PAYMENT

AEPS (Aadhaar enabled payment system)

Aadhar Enabled Payment System (AEPS),is India’s most innovative way of getting
cashless transactions done with an Aadhar card. The Aadhaar Enabled Payment
System gives banking facility to peoples. This system has been tailor made to suit the
needs of rural India where internet and even telephony hasn’t reached its peak yet.
The four services can be done through the AEPS;

 Cash deposit
 Cash withdrawal
 Aadhaar to aadhaar fund transfer
 Balance check

A special machine is require to transact these system. A micro ATM with a finger print
scanner connected to it is generally used for transaction. AEPS is relatively a new
system and therefore currently available in very limited regions. It is great benefit for
Rural India where people can buy the Aadhar Micro ATMs and avail of all these
services.
 No phone needed
 The beneficiary should have an Aadhar card
 The Aadhar card should be linked to our bank account
How can use it?

Step 1- Go to Micro ATM with your Aadhar card and choose transaction (A/C
Balance, fund transfer, cash withdrawal)
Step 2-Provide fingerprint on scanner
Step 3-On successful transaction, take the print slip

Micro ATM: A mobile Device with Aadhar app launched and a finger print Scanner
Connected to it for your authentication. Once you type the aadhar card number and
Scan your finger print on the connected finger print scanner, the app Connects to your
registered bank account directly and you can transfer/withdraw money.
Currently, we can have only one bank account registered with aadhar card. If you get
your aadhar card connected to a different account, the first account automatically gets
released from the aadhar card connection. The AEPS is a relatively costly transaction.
It can go up to Rs15 for one transaction.

E-WALLET
It is basically a virtual wallet available on your mobile phone. You can store cash in
your mobile to make online or offline payments. Various service providers offer these
wallets via mobile apps, which is to be downloaded on the phone. You can transfer the
money into these wallets online using credit/ debit card or Net banking. This means
that every time you pay a bill or make a purchase online via the wallet, you won’t
have to furnish your card details. You can use these to pay bills and make online
purchases.

PLASTIC MONEY
It includes credit, debit and prepaid cards. The latter can be issued by banks or non-
banks and it can be physical or virtual. These can be bought and recharged online via
Net banking and can be used to make online or point-of-sale (PoS) purchases, even
given as gift cards. Cards are used for three primary purposes for withdrawing money
from ATMs, making online payments and swiping for purchases or payments at PoS
terminals at merchant outlets like shops, restaurants, fuel pumps etc.

NET BANKING
It does not involve any wallet and is simply a method of online transfer of funds from
one bank account to another bank account, credit card, or a third party. You can do it
through a computer or mobile phone. Log in to your bank account on the internet and
transfer money via national electronic funds transfer (NEFT), real-time gross
settlement (RTGS) or immediate payment service (IMPS), all of which come at a
nominal transaction cost.

UPI (Unified Payments Interface)

UPI is a system that powers multiple bank accounts into a single mobile
application(of any participating bank). It merging several banking features, seamless
fund routing & merchant payments into one hood. It also caters to the “Peer to Peer”
collect request which can be scheduled and paid as per requirement and convenience.

USSD (Unstructured Supplementary Service Data)

One of the innovative payment service launched by NPCI includes *99# service,
which works on USSD channel. *99# service has been launched to take the banking
services to every common man across the country.
 CHAPTER-4
DATA ANALYSIS AND INTERPRETATION
 TABLE 4.1 AGE WISE CLASSIFICATION

AGE NO OF RESPONDENDS %OF RESPONDENTS

BELOW 20 18 36%
20-30 25 52%
30-40 4 8%
ABOVE 40 2 4%
TOTAL 50 100%

4%
8%

36%

52%

BELOW 20 20-30 30-40 ABOVE 40

INTERPRETAION
Out of 50 people’s 36% are include in the age group of below 20, 52% are in 20-30
age group, 8% are in 30-40 age group and 4% are in above 40 age.
 TABLE 4.2 GENDER WISE CLASIFICATION

GENDER NO OF RESPONDENDS %OF RESPONDENTS

MALE 28 56%
FEMALE 22 44%
OTHER 0 0%

44%

56%

MALE FEMALE OTHER

 TABLE 4.3 MONTHLY INCOME

MONTHLY INCOME NO OF RESPONDENTS %OF RESPONDENTS

BELOW 10000 29 58%
10000-50000 17 34%
50000-100000 2 4%
ABOVE 100000 2 4%

FIGURE 4.3 MONTHLY INCOME

4%
4%

34%

58%

BELOW 10000 10000-50000 50000-100000 ABOVE 100000

INTERPRETATION
From the above table it is found that out of 50 respondents who answered the questionnaire,
58% earns below 10000, 34% earns 10000-50000, 4% earns 50000-100000, 4% earns above
100000. Hence the majority of the people who purchase Himalaya products earn 10000
 TABLE 4.4 HOW OFTEN DO YOU USE CASHLESS PAYMENT
METHODS
OPTIONS NO OF RESPONDENTS % OF RESPONDENTS
SEVERAL TIMES A DAY 32 64%
ONCE A DAY 11 22%
SEVEAL TIMES A WEEK 7 14%
ONCE A WEEK 0 0%

FIGURE 4.4 HOW OFTEN DO YOU USE CASHLESS PAYMENT

METHODS
%

14%

22%

64%

SEVERAL TIMES A DAY ONCE A DAY SEVEAL TIMES A WEEK ONCE A WEEK

INTERPRETATION
From the above table it is found that out of 50 respondents who answered the questionnaire,
64% knows about the Himalaya product through advertisement, 23% knows about the
Himalaya product through friends, 14% knows about the Himalaya product through dealers,
Hence majority of the people who purchase Himalaya products are through advertisement.
 TABLE 4.5 WHAT CASHELESS PAYMENT METHOD DO YOU USE
REGULARLY
OPTIONS NO OF RESPONDENTS % OF RESPONDENTS

CREDIT CARD/DEBIT CARDS 17 34%

MOBILE WALLETS 14 28%
ONLINE BANKING 5 10%
PAYMENTS 14 28%

FIGURE 4.5 WHAT CASHELESS PAYMENT METHOD DO YOU USE

REGULARLY

28%
34%

10%

28%

CREDIT CARD/DEBIT CARDS MOBILE WALLETS

ONLINE BANKING PAYMENTS

INTERPRETATION
From the above table it is found that out of 50 respondents who answered the questionnaire,
47.76% use skin care products, 25.37% use hair care products, 8.96% use baby care products,
17.91% use other products. Hence majority of the people use skin care products of Himalaya.
 OPTIONS NO OF RESPONDENTS % OF RESPONDENTS

MUCH MORE CONVENIENT 8 16%

SOMEWHAT CONVENIENT 19 38%

SOMEWHAT LESS CONVENIENT 17 34%

MUCH LESS CONVENIENT 6 12%

TABLE 4.6 HOW DO YOU PERCEIVE THE CONVENIENCE OF

CASHLESS TRANSACTIONS COMPARED TO USING CASH

FIGURE 4.6 HOW DO YOU PERCEIVE THE CONVENIENCE OF

CASHLESS TRANSACTIONS COMPARED TO USING CASH

26%
32%

42%

DAILY WEEKLY MONTHLY

INTERPRETATION
From the above table it is found that, out of 50 respondents who answered the questionnaire,
16% buy the Himalaya products at medical shops, 38% buy the Himalaya products at retail
stores, 34% buy the Himalaya products at departmental stores, 12% buy the Himalaya
products at others, Hence majority of the people buy the Himalaya products at retail stores
 TABLE 4.7 HOW MUCH DO YOU TRUST SECURITY MEASURES IN
PLACE FOR CASHLESS TRANSACTIONS
OPTIONS NO OF RESPONDENTS % OF RESPONDENTS
COMPLETELY TRUST 12 24%
SOMEWHAT TRUST 16 32%
NEUTAL 8 16%
SOMEWHAT DISTRUST 8 16%
COMPLETELY DISTRUST 6 12%

FIGURE 4.7 HOW MUCH DO YOU TRUST SECURITY MEASURES IN

PLACE FOR CASHLESS TRANSACTIONS

12%
24%

16%

16%
32%

EXTREMELY IMPORTANT VERY IMPORTANT SOMEWHAT IMPORTANT

NOT SO MPORTANT NOT AT ALL IMPORTANT

INTERPRETATION
From the above table it is found, out of 50 respondents who answered the questionnaire, 24%
choose quality is extremely important when choosing a health and wellness product. 32%
very important, 16% somewhat important, 16% not so important, 12% not at all important.
 TABLE 4.8 HAVE YOU EVER EXPERIENCED SECURITY ISSUES
WITH CASHLESS PAYMENT
OPTIONS NO OF RESPONDENTS % OF RESPONDENTS
YES 19 38%
NO 8 16%

FIGURE 4.8 HAVE YOU EVER EXPERIENCED SECURITY ISSUES

WITH CASHLESS PAYMENT

16%

38%

YES NO

INTERPRETATION
From the above table it is found that out of 50 respondents who answered the questionnaire,
38% people choose the product containing natural and herbal ingredients, 16% are not,34%
sometimes,12% never.
TABLE 4.9 HOW FREQUENTLY DO YOU USE CASHLESS PAYMENT
METHODS
OPTIONS NO OF RESPONDENTS % OF RESP62.75ONDENTS
DAILY 13 26%
WEEKLY 21 42%
MONTHLY 16 32%

FIGURE 4.9 HOWFREQUENTLY DO YOU BUY HIMALAYA

PRODUCTS

Sales

2nd Qtr 3rd Qtr 4th Qtr

INTERPRETATION:
From the above table it is found that out of 50 respondents who answered the questionnaire,
26% buy the Himalaya products yearly once, 42% buy the Himalaya products monthly, 32%
buy the Himalaya products weekly. Hence majority of the people buy the Himalaya products
monthly