Wednesday, 12 December 2012

Ruling Political Party

Facility of storing money in small size (high denomination notes) makes it easy for corrupt people to store their wealth acquired from unethical means. Expenditure on election campaign by the candidates is another reason for corruption. A solution is needed for these 2 issues. Prior preparations are must to resolve these issues. I would take high denomination solution first.

Money transfer by cheque appears to be a good solution. However, arrangements are required for easy and secured transfer. First requirement would be development of software and creating centres for this transfer. Such centres should be available not only in bank but at all places where trading takes place. Therefore, every shop, every office, every hospital, school wherever transactions take place money transfer through cheque facility must be available. Every place should have unique identity and cheque amount should get deposited in that account only. The procedure should be payer hands over a blank cheque with his signature and or thumb impression to payee for money transfer. Payee fills in his/her name and amount and and checks availability of adequate credit (not exact credit) in the account. If adequate credit is available the cheque is returned to the payee for signature and or thumb impression for carrying out transaction. This way there would be no danger of false cheque or incorrect money transfer. This method shall be much safer than the credit card or cash transaction.

In order to follow this procedure, payer must have a bank account. The government should issue orders for bank account with zero balance. Banks should not be worried as all transactions shall be through the account there shall be money deposited in that account in due course of time.

After these preparations are ready all citizens should be asked to deposit paper money with denomination
` 100 and above. Banks should accept all notes without any immediate check. All received notes should be stamped and account number in which deposits are made is noted on all notes. Account holder also should put his/her thumb impression on the notes. Notes should be thoroughly checked and if found in order should be credited to the account. Also information should be sent to income tax department for deposits above a certain predetermined limit. In case some currency note are found false then suitable action should be taken against the depositor as per existing rules.

All these actions should be planned and executed at correct time. Example is the currency notes may not be withdrawn right now. First action should be taken for carrying out transactions through bank, and then adequate time should be given for depositing currency notes and so on. This way there shall be no need to print low value currency notes. The existing quantity shall be sufficient.
After taking this action more is required as given here.

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