Covid19 has brought a hugely visible and invisible impact on Banking Industry. Out of these impacts, what banks recently initiated was ‘Digital Dakshina’. Dakshina is pretty popular in Nepalese culture and is widely used during festive times like Dashain and Tihar. Considering the risks that physical money bears, it is appropriate that Digital Dakshina would capture the market too. Banks have induced this product even in their Mobile Bankings. Despite enough promotional campaigns, Digital Dakshina could not grow as popular as expected.
Following are the reasons behind it.
There is a large chunk of the population who are still not into the access to Internet and Banks. This is the key reason why the market did not respond as expected. This turns out to be a key reason why one huge bunch of market is left uncaptured and made unaware around. Society should first get access, and only then other promotion campaigns would be effective enough. Else, that should be targeted only for the special bunch. Digital Dakshina is a nice idea at right time, but maybe society is not yet prepared for it. Even if they get loaded by Digital Dakshina, they should rush to the bank for payment with their cheques, as their digital Dakshina will not be accepted in various merchant’s stores.
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An important reason why Digital Dakshina did not get popular as expected is because of the credibility issue. Slight issues can trouble at peak times. A lot of times because of the system error that it has, and other times because of the network errors there are chances of mistakes. And, if mistakes happen there turns out to be a huge trouble for any users – call the concerned bank, follow them up, and keep waiting for the fund to be transferred. At the last hour, a customer might even cancel their purchase order. Until and unless these apps are made efficient enough, it is less likely that they will be popular as thought.
The next crucial reason why digital banking or digital Dakshina did not turn out so popular is that we are habituated to traditional forms of payment. We still love red-colored new cash notes as Dakshina than going digital, as we grew up with it. We love collecting all Dakshina and counting it again and again; so that hits the aspect that we don’t want to change. This resistance to change with our previously formed habit has been the next important reason for not accepting Digital Dakshina in reality. It is obvious that older aged people don’t want to go through this new habit, but there is a younger generation who don’t want this change too. Ultimately, the habit did not change on an overall basis within just a month.
Affection for Physical Cash
There are special affection and love among Nepalese towards physical cash which restricts easy use of the digital transaction. We still love to keep our wallets heavy through physical cash and enjoy shopping through the use of cash more than going digital. Although there have been several incentives initiated by banks, they could not touch one big chunk; but were limited to a small number of users themselves. Cash is easy, and easily convertible in accounting principles and real-life as well. This has always encouraged cash-based transactions more than any other form of payment.
Not all region of Nepal has got access to 4G. There are regions where data does not work effectively around. So, having balance in digital format is not enough if the data network is not strong. This has been the next major reason why people still prefer cash over digital balance. It is okay to have digital balance, but they are in use only in city and town areas, and it is unknown where the network will start operating low. Had there been confidence over a strong network, that would be easy. To date, some Gaupalikas don’t have Internet access at all as well, and hence dream of the cashless transaction is pretty tough.
Okay, if someone has a balance in their Bank Account, have access to Mobile Banking too. But, are the environment around him supportive enough to promote Digital Transfer? There aren’t any battery charging points in most wanted places too, be that bus park or any other relevant places; which makes cash rather easy in comparison to any other. There are questions left unanswered like, What if mobile shuts down during long travel, are there public battery charging place? What if someone reaches the region where there is no internet access? This has raised serious questions over the reliability
[Mr. Dwaipayan Regmi is currently working as the Assistant Manager in Rastriya Banijya Bank]
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