Ban Cheque Books? Report Suggests Modi Govt’s Next Digital Transactions Push

3 min read
Aimed at encouraging digital transactions and to create a cashless India, the Centre is likely to ban all cheque books.

In yet another controversial and disruptive move – after demonetisation – aimed at encouraging digital transactions and create a cashless India, the Centre is likely to ban all cheque books, a decision that could affect the transaction preferences of millions of people in the country.

News agency Press Trust of India (PTI), in a story dated November 16, has quoted a senior official of a prominent trade body as sayig that the government needs to encourage the use of debit and credit cards.

Confederation of All India Traders (CAIT) Secretary General Praveen Khandelwal told PTI, “In all probability, the Centre may withdraw the cheque book facility in the near future to encourage digital transactions.” He was talking to reporters at the launch of ‘Digital Rath’, a joint initiative of the CAIT and Mastercard to encourage traders to adopt different modes of digital transactions and promote cashless economy.

“The government spends Rs 25,000 crore on printing of currency notes and another Rs 6,000 crore on their security and logistics. Moreover, banks charge 1 per cent on payments through debit card and 2 per cent through credit cards. The government needs to incentivise this process by providing subsidy directly to the banks so these charges can be waived,” he said.

Khandelwal claimed only five per cent of the total 80 crore ATM-cum-debit cards are used for cashless transactions, while 95 per cent of them are used for cash withdrawals.


The ban is most likely to affect the trading community as it relies heavily on cheque books. Over 95 per cent transactions occur through cash and cheques.

There is also a possibility that cheque transactions may have increased manifolds ever since demonetisation crippled cash transactions.

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