The Dawn of Cash Comeback: Bengaluru's Vendors Revive Paper Currency
Small vendors in Bengaluru prefer cash over UPI fearing GST scrutiny and eviction, challenging the city's digital payment dominance.
In a surprising financial shift within the vibrant metropolis of Bengaluru, small vendors are increasingly reverting to cash transactions over digital payment systems like UPI, citing fears of GST scrutiny and potential business disruptions.
A Shift in Payment Landscape
The once ubiquitous QR codes on store counters have given way to handwritten notes declaring “No UPI, only cash.” In a city renowned for leading India’s digital payment revolution, this marks a significant retreat. Vendors, from small shopkeepers to street cart sellers, are caught in a GST crossfire that they find overwhelming.
Voices from the Ground
“I can’t afford UPI payments anymore,” laments Shankar, a shopkeeper from Horamavu. He echoes a sentiment shared by thousands of unregistered businesses across Bengaluru, whose digital footprints have now drawn the tax department’s attention.
Legal and Economic Concerns
The core of the issue lies in GST notices sent by tax authorities based on transaction data hinting at required registration thresholds. Unregistered businesses, often operating on thin margins, feel the heat from demands for extensive paperwork and taxes.
Expert Insights and Industry Response
Vinay K Sreenivasa from the Federation of Bengaluru Street Vendors Associations says this is prompting vendors to avoid digital payments altogether. The ongoing situation has also drawn political attention, with MLA S Suresh Kumar urging intervention from the chief minister.
According to The Economic Times, the state’s tax targets and pressing financial commitments have left Karnataka’s revenue department exploring every avenue for potential tax income. It remains to be seen if cash transactions will gain stronghold enough to prompt similar trends in other states.
Reflecting on the Future
As Bengaluru potentially sets a national precedent, the question arises whether other Indian cities will follow suit in leveraging unregistered businesses for revenue. For now, the city finds itself at a crossroads, battling between the ease of digital payments and the tangibility of cash.