Tough to go cashless in rural areas, says economist

Minister Rina Harun makes a cashless payment through her smartphone at a Ramadan bazaar in Kampung Baru, Kuala Lumpur. (Bernama pic)

PETALING JAYA: An economist, disagreeing with a minister’s idea to bring villages and rural areas into a cashless society, says poor accessibility and connectivity would make it impossible to carry out the plan by year-end.

Madeline Berma, who specialises in rural development, said there was a lack of infrastructure and “info-structure” in rural areas, especially in Sabah and Sarawak.

However, the government could begin cashless transactions in areas with full internet connectivity, she added.

Rural Development Minister Rina Harun recently said rural areas nationwide could go cashless by year-end.

She said the plan, part of the Smart Village programme, would be launched in July, to encourage more entrepreneurs in rural areas to market their products online.

However, Berma said most people in rural communities were in need of sufficient knowledge, skills and information to benefit from any shift towards a cashless economy, noting the risk that they could be marginalised.

“In a cash economy, they transact using physical money which they are familiar with. In a cashless economy, transactions are mostly online – that is unfamiliar to the less educated.”

She said the shift could also lead to unscrupulous activities such as fraud. - FMT