"For hundreds of years, the monetary system of most countries has been based on the exchange of metal coins and printed pieces of paper. However, because of recent developments in technology, the international community should consider replacing the entire system of coins and paper with a system of electronic accounts of credits and debits."
Since the advent of humanity and society, the system of give and take has been prevalent in different forms. In the past, the exchange of goods was done through a system called as the barter system. In this system, two different types of items or group of items, considered to be of equal value, were exchanged between each other. Gradually, with the progress of the human society, the monetary system based on coins and papers began. It has been hundreds of years that the monetary system has been followed successfully in most countries. As the human society started to grow further, there were technological advancements made over the years. Now, the human society is so complex and advanced that exchange of coins and paper is not always necessary. With the help of technology, humans have been able to develop an electronic system to maintain accounts of credits and debits for all individuals. In the preceding statement, the author claims that the international community should consider replacing the entire system of coins and paper with a system of electronic accounts of credits and debits. Let us first discuss the pros and cons of the author's idea before taking a stand.
Today, there are many countries that have implemented the electronic system of exchange for different services. For example, in developed countries such as US and UK, when people arrive at the petrol station, they just need to self-serve themselves, fill in their vehicle's petrol tank with the desired amount of petrol, swipe their electronic cards and make the payment. This has made life of the citizens of US and UK simpler than what it was before the use of electronic systems. Thus, the electronic system of payment is very convenient and time-saving.
Let us now consider the example of a developing country such as India. In India, more than 60% of the population is Below the Poverty Line (BPL). In other words, we can say that majority of the people in India are BPL. The current electronic system has certain terms and conditions required to be satisfied by the card or account holders. One of such rules requires that an individual maintains a minimum pre-decided amount in the account in order to avail the electronic system facilities. So Indians who are BPL cannot make use of the electronic system. Thus, in order to replace the entire existing monetary system, the concerned international communities will need to consider making certain modifications to the existing Bank rules so that the electronic system can be applied universally. In such a case, analysis of cost incurred in implementing the new electronic system to replace the existing monetary system versus the benefits expected to be achieved via the new system becomes necessary.
The electronic system of banking has, by far, proved to be the safest, fastest and most convenient system. People from anywhere in the world can trade with the help of net banking very easily and quickly. Despite of the many advantages of using an electronic system of maintaining accounts, there is one risk or threat, which is one of the major concerns in the Information Security department of every Bank and Investment company. This risk is nothing but the risk of internet hacking and phishing. In case of monetary exchange via coins and printed papers, the above threat of hacking is nil. However, this type of system faces the threat of theft or robbery, which is absent in case of the electronic system.
In sum, both the systems - electronic and the one based on exchange of coins and printed papers, have pros and cons. Thus, before replacing the current monetary system with the new electronic system completely, it is necessary to evaluate both the systems appropriately, analyze their merits and demerits by conducting several studies on a real time basis.
Since the advent of humanity and society, the system of give and take has been prevalent in different forms. In the past, the exchange of goods was done through a system called as the barter system. In this system, two different types of items or group of items, considered to be of equal value, were exchanged between each other. Gradually, with the progress of the human society, the monetary system based on coins and papers began. It has been hundreds of years that the monetary system has been followed successfully in most countries. As the human society started to grow further, there were technological advancements made over the years. Now, the human society is so complex and advanced that exchange of coins and paper is not always necessary. With the help of technology, humans have been able to develop an electronic system to maintain accounts of credits and debits for all individuals. In the preceding statement, the author claims that the international community should consider replacing the entire system of coins and paper with a system of electronic accounts of credits and debits. Let us first discuss the pros and cons of the author's idea before taking a stand.
Today, there are many countries that have implemented the electronic system of exchange for different services. For example, in developed countries such as US and UK, when people arrive at the petrol station, they just need to self-serve themselves, fill in their vehicle's petrol tank with the desired amount of petrol, swipe their electronic cards and make the payment. This has made life of the citizens of US and UK simpler than what it was before the use of electronic systems. Thus, the electronic system of payment is very convenient and time-saving.
Let us now consider the example of a developing country such as India. In India, more than 60% of the population is Below the Poverty Line (BPL). In other words, we can say that majority of the people in India are BPL. The current electronic system has certain terms and conditions required to be satisfied by the card or account holders. One of such rules requires that an individual maintains a minimum pre-decided amount in the account in order to avail the electronic system facilities. So Indians who are BPL cannot make use of the electronic system. Thus, in order to replace the entire existing monetary system, the concerned international communities will need to consider making certain modifications to the existing Bank rules so that the electronic system can be applied universally. In such a case, analysis of cost incurred in implementing the new electronic system to replace the existing monetary system versus the benefits expected to be achieved via the new system becomes necessary.
The electronic system of banking has, by far, proved to be the safest, fastest and most convenient system. People from anywhere in the world can trade with the help of net banking very easily and quickly. Despite of the many advantages of using an electronic system of maintaining accounts, there is one risk or threat, which is one of the major concerns in the Information Security department of every Bank and Investment company. This risk is nothing but the risk of internet hacking and phishing. In case of monetary exchange via coins and printed papers, the above threat of hacking is nil. However, this type of system faces the threat of theft or robbery, which is absent in case of the electronic system.
In sum, both the systems - electronic and the one based on exchange of coins and printed papers, have pros and cons. Thus, before replacing the current monetary system with the new electronic system completely, it is necessary to evaluate both the systems appropriately, analyze their merits and demerits by conducting several studies on a real time basis.
