The reactive thinker.

In his youth man gets an idea that he is a freethinker. Sometimes this thought is carried forward into his older age. But it for most people the false sense of freedom diminishes over time. Sooner or later he realises that there are much larger forces at play.

For the young man it may seems like social convention are the main impediment to man's freedom. It seems like most men are enslaved by religion and arbitrary customs, while he himself is free of such chains. What else could be described as free thought. Like I said, there are larger forces at play, and they are history and biology. What is custom next to the whole of human history much less to whole of life's history. Let us not delve into the realm of physics.

Freedom of movement

Contrary to popular belief people of olden times had much more freedom of movement than modern man. Not only was the population lower allowing man to utilise the free spaces, there was lesser cultural limitations placed on travel. This would seem counter-intuitive considering our concpetion regarding the past as a time of institutionalised discrimination, and our own time as more egalitarian one. But the crux of the matter is that the modern urban man lives in an extremely constricted environment. He is free to travel. But only through the narrow and conjested conduits that is the modern tarred roads. Here too he must follow a myriad of written and unwritten rules. Not only must he keep to a particular side of the road at a particular velocity, but he must be aware and ready to use a large number of legally and culturally mandated manoeuvres to make his way through. It is not surprising that he finds the whole exercise tiresome.

An even more insidious barrier to human movement are those that are not legally mandated, but that which are culturally self imposed. An olden man walking the earth could squat on the side of the road when his legs got tired. He could put a blanket down on the earth to take a nap. What worried him was the Elements and the possibility of being ambushed. The modern man if he chooses to walk the earth can't sit down if it is not a place designated to sit in. He cannot sleep on the side of the road. He not only risks getting his cloths dirty he is at risk of being branded a hobo or even worse a rebel. One pattern that can be noted in our time in India is that the degree of freedom decreases as one moves up the social ladder. In kerala it is acceptable for a Bengali labourer to swat in the foot path. A lower class malayalee may sit on a shop step. An middle class malayalee loses that privilege. Maybe a bust of bench for him. Moving higher up options and space is limited even further.

As we move higher up the scales our freedom is being limited to basically our bedroom ; or even the toilet seat.

Banking

People, even economists misunderstand the nature of banks on the modern economy. Most people hold on to an ancient concept of banking: that bank take money from the public and give out loans charging interest for it while giving interest for deposits. This concept is woefully outdated. This would have held true when the economies of the world were on gold standard and banks were independent. The money supply was limited by physical factor: that of gold production. Economiea today rely on fiat currency, that is not backed by anything other than institutional assurance, that is RBI governors signature. The currency has a floating value that keeps changing with the social, economic, political and cultural landscape. In today's economy the central banks, retail and commercial banks, the government, private citizens and businesses for part of a nexus that keeps the value of money at a more or less useful level. The idea of the individual being a banks customer is outdated.

Banks don't depend on your deposits to give out loans. They get their money from the reserve bank as loans. That is loaned to people for interest. The difference in interest is the profit.

As it stands now the service provided by banks in terms of providing ATM's and savings account are only a convenience. It is a cost on the bank. Banks would be right to charge for these services. And the value provided by these services are actually worth what is charged. For example, your money is kept safe in a public place under AC for you to withdraw at your convenience.

The high rate of cash usage in a India is actually justification for using these means to achieve higher levels of cashlessness. In foreign countries the charges maybe low, that is because large transactions take place through cashless means. The number of cash transactions are lees, so they don't incur high cost for cash transactions like in India, where even educated IT professionals use cash for high value transactions. Our IT professional will go to atm 4 days in a row to withdraw 1lakh to buy something.

Regarding the cost of digital transaction. It doesn't matter becuase there is hidden cost in cash transactions that are not easily apparent. You are paying more than the 2 percent charge when cash is used. Think of this. For a cash transaction you need a clerk at the bank, how many transaction does a clerk do a day. What is he paid. If he does 50 transactions a day and he is paid 1000 Rs a day that is 20 Rs per transaction. This is surely passed on to consumers.