IBRAHIMPUR (SIDDIPET): Very few customers frequent Nampally Rajaiah’s roadside cigarette shop located at the entrance to the Ibrahimpur village. Footfalls are limited to thrice a day, when RTC buses cross village. Rajaiah makes Rs 6,000 a month to feed his family of four.
After Prime minister Narendra Modi announced the demonetisation of Rs 500 and Rs 1,000 notes on November 8 last year, the villagers collectively decided in December to adopt digital means to beat the cash crunch. Subsequently, Ibrahimpur was adopted by Telangana state Irrigation Minister T Harish Rao for going cashless.
A month after the Prime Minister’s announcement, Rajaiah and other traders like him subscribed to Point of Sales (PoS) machines. Ibrahimpur hit the headlines as the first village in south India to go fully digital. But Andhra Bank’s decision to charge a monthly fee of Rs 1,400 for the machines came as a shock for traders in the village. Rajaiah decided to get rid of his machine.
“The fee was arbitrary,” says Rajaiah. “The bank officials never told us that one day we would have to pay for these machines.” Of the 11 establishments in the village that had gone digital, two have returned their PoS machines. Nine others have stopped using them.
The machines were free till February 2017. But from March, the bank started deducting Rs 1,400 from users’ accounts without prior notification. Officials claim the deal was explained to the village sarpanch, and through him to the villagers. But the public insist they were kept in the dark. After speaking to Nagesh Reddy, son of the sarpanch, it becomes clear that the documents signed by the semi-literate villagers, while subscribing to the swipe machines, were not in Telugu but English.
“Only two PoS machines have been returned, the rest nine are with the villagers. We are in talks with our zonal office to waive off the rental fee for the villagers,” assures Mulla Shankar, Andhra Bank’s Narayanraopet branch manager. Apart from the rental charge, banks also levy a Merchant Discount Rate (MDR) of 0.25 per cent on transactions less than Rs 1,000. Transactions between Rs 1,000 and Rs 2,000 are charged 0.5 per cent and transactions of higher value are charged 1 per cent. These costs are also borne by the PoS machine owner.
On record, 59-year-old Laxmi Raghava Reddy is the lady sarpanch of Ibrahimpur. But her duties are being executed by her sons Yella and Nagesh Reddy. The real sarpanch, in fact, lives 25 km away in Siddipet. To retain the “digital village” tag, sarpanch’s sons are pushing for a micro-ATM from IDFC bank to be installed here and Rajaiah is the applicant. Four other villagers have already switched to micro-ATMs. The prospect of earning a commission from transactions made at the machines makes the proposal attractive for Rajaiah. But he is not aware that even these machines attract transaction charges.
An 80-year-old pensioner, E Narsava, is seen waiting in front of Kammatam Ramaswamy’s kirana store. They are there to withdraw their Aasara pension using the micro ATM at the kirana. They have to wait for Ramaswamy to return from Siddipet with supplies for his store and cash. But, why draw cash in a cashless village? ”Some people still use their card to pay for items that cost as little as Rs 6. But still, many are dependent on cash,” says Ramaswamy’s wife Sandhya.
Take for instance the case of ration shop owner Venkat Rajam. Ironically, Rajam is in need of cash to fix his broken micro-ATM. “I bought this machine only in April but the biometric reader isn’t responding,” says Rajam. “I need to travel 25 km to meet the supplier and get the machine fixed but none of the transportation services accept cards of app-based payments. Where do I go for cash?”
Data shows that India’s digital transactions rose 13.5 per cent in September, the second-highest level since demonetisation. While such transactions peaked in March this year, it saw a considerable dip in the following months due to the return of cash into the system. The DigiDhan Mission, on the other hand, is far from reaching its target.
The State government also has its own “Digital Telangana” mission which aims to provide 4G internet connectivity through Optical Fibre Cable that passes through water trenches used for Bhagiratha Mission. These pipes were seen dumped along the route connecting the village to Siddipet but works are yet to begin.The village has free wifi but serves few and is choppy. Though some villagers are aware of the Bharath QR code, Bhim app, its cousin Bhim-Aadahar Pay app and other online payment gateways, cash still rules the roost in this village of 1,400 people. Now, Ibrahimpur’s tag of being the first digital village in southern India is just a ruse to attract tourists.