Adoption of Alternate Strategy by a state alone-cashless transactions

Extracts from Simple Alternate Development Strategy  -1997′

“The alternate strategy involves printing of currency notes and this is under the purview of the central government,  A question will therefore arise as to how a state government can adopt  this strategy without the central government’s involvement. This is not difficult. The state government can sanction loans to a farmer for digging wells and pay the amount by tokens which can be made legal tender. The farmer can pay the workers employed by him  with these tokens and the workers can buy their requirements from the shops with tokens and the shopkeepers can pay taxes, electricity bills, water bills etc to the government with these tokens. At other level, the, the state government can sanction loans to the farmers for digging wells and credit the  loan amounts to accounts of  the farmers in a state financial institution. The farmers  can pay the workers  with a slip/chit/cheque and these amounts could be credited to the workers’ accounts in the institution. The workers can pay the shopkeepers for their requirements like food grains, clothing, footwear etc by slips/cheques. There can be settlement of accounts in the financial institutions once in a week or two weeks or a month.  ”

The above extract, though about improving agriculture and overall economy, describes the possible operation of cashless economy


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