E-payments can help govt save One Lac crore a year: McKinsey Inbox X

E-payments can help govt save One Lac crore a year: McKinsey

New Delhi, November 1: An estimated annual savings of around Rs.1,00,000 crore makes a compelling case for the government to make a one-time investment of Rs.60,000-70,000 crore to build an electronic payment platform for all its transactions with individual households, says consulting firm McKinsey.

Such a platform could help the government save Rs.71,000 crore a year, while benefiting individual beneficiaries to the tune of Rs.26,200 crore. Many of the beneficiaries would be from financially excluded households as most of the transactions between the government and households relate to welfare schemes, the consultancy said in a report Inclusive growth and financial security: The benefits of e-payments to Indian society released on Monday.

The cost of building the e-platform is prohibitive, but benefits far outweigh the costs, as it would enhancing the efficiencies of the payment system by reducing leakages, increased the efficiency of delivery of services and lower administration costs. Leakages account for about 75-80% of the losses that the government suffers due to the manual payment system, while share of transaction cost is estimated at 15-20% of the losses, says the report.

A National Rural Employment Guarantee Scheme worker loses as much as Rs.6-7 in wages and travel costs to redeem the Rs.100 she earned for a day's work. The saving of Rs.1,00,000 crore is equivalent to about 10% of the total payment flow between the government and households, considering that in 2008-09, such payments in form of direct cash transactions, subsidies and public services such as education and healthcare amounted to Rs.13,30,000 crore. Savings would be maximum on welfare schemes such as targeted public distribution system and national rural employment guarantee programme where the government could save as much as Rs.82,700 crore, as payment inefficiencies are 30% or more. The savings of Rs.1,00,000 crore is equal to 20% of the fiscal deficit or 25% of the government's welfare spending. The amount is enough to meet the entire expenditure on Sarva Shiksha Abhiyan, the universal primary education programme, or double the outlay for fertiliser subsidy.

However, the most significant gain from an e-payment platform in a country of 80-100 million poor households would be in the form of financial inclusion.

"An e-payment platform would enable the formal financial sector to more easily and efficiently reach disadvantaged Indian households and offer modern financial products," the report says. But getting to a point where the government can make this saving requires all its departments and agencies to be fully networked to ensure that all information transfer is electronic. It would require installation of accessible and convenient transaction points, with one in every village.

The government would also need to ensure reliability of payment by making the system tamper-proof. This would require installation of identity authentication infrastructure, especially at payment points that serve the poor, illiterate and rural sections of India.

That apart, the e-payment investment can be made viable only if the financial service providers and intermediaries align themselves as stakeholders in the set-up. The government would also need to ensure that the infrastructure created is put to use. This would entail transfer of all salaries is done electronically, and use of cash and cheques is eliminated. Similarly, all payments to vendors and contractors would have to be made electronically.

Your Ideal Self and Life

Your self-concept is made up of three parts, each of which affects each of the others. Understanding these three parts enables you to put your hands on the keyboard of your own mental computer. When you learn to take charge of the development of a new and positive self-concept of selling, you can then control your sales destiny for the rest of your career.

Determine Your Direction

The first part of the self-concept is the "self-ideal." Your self-ideal largely determines the direction in which you are going with your life. It guides the growth and evolution of your character and personality. Your self-ideal is a combination of all of the qualities and attributes of other people that you most admire. Your self-ideal is a description of the person you would very much like to be if you could embody the qualities that you most aspire to.

Strive Toward Excellence

Throughout your life, you have seen and read about the qualities of courage, confidence, compassion, love, fortitude, perseverance, patience, forgiveness and integrity. Over time, these qualities have instilled in you an ideal to which you aspire. You might not always live up to the very best that you know, but you are constantly striving to be a better person in light of those qualities that you value so highly. In fact, everything that you do on a day-to-day basis is affected by your comparing your activities with these ideal qualities and your striving to behave consistently with them.

Clarity is Essential

Successful salespeople have very clear ideals for themselves and their careers. Unsuccessful salespeople have fuzzy ideals. Successful salespeople are very clear about being excellent in every part of their work and their personal lives. Unsuccessful salespeople don't give the subject very much thought. One of the primary characteristics of successful men and women in every walk of life is that they have very clearly defined ideals and they are very aware of whether or not their current behaviours are consistent with their idealized behaviours.

Set Challenging Goals

Part of your ideals are your goals. As you set higher and more challenging goals, your self-ideal improves and crystallizes. When you set goals for the kind of person you want to be and the kind of life you want to live, your self-ideal rises and becomes a greater guiding and motivating force in your life.

Your Future is Unlimited

Perhaps the most important thing for you to realize is that whatever anyone else has done or become, you can do or become as well. Improvements in your self-ideal begin in your imagination, and in your imagination, there are no limits except the ones that you accept.

What is your ideal vision of the very best person you could possibly become? How would you behave each day if you were already that person? Asking yourself these questions and then living your life consistent with the answers is the first step to creating yourself in your ideal image.

Action Exercises

Here are two things you can do immediately to put these ideas into action.

First, dream big dreams. Set big, exciting, challenging goals and ideals for yourself in every part of your life. Allow yourself to imagine a wonderful life ahead.

Second, think about how you would act if you were an outstanding person in every way. Then, practice being this person, as though you were acting a role in a play. You'll immediately notice a difference in your behaviour.

SOCH VICHAR*: Super-rich investors buy gold by tonne

SOCH VICHAR*: Super-rich investors buy gold by tonne: "The world's wealthiest people have responded to economic worries by buying gold by the bar -- and sometimes by the tonne -- and by moving as..."

What will be the state of the mind of a pure soul, in times of joy and sorrow?

The rain falling on the mountain range slides down the sides into many valleys and flows as turbid streams. The same rain falling on fresh water lakes or limpid rivers remains pure and clear. The sages who are cognizant of their Atmic reality are transformed into the purity, equanimity, and charity that it represents. They are ever in the full awareness of the Atma, their inner core. In the purified consciousness of these persons, there is the experience of identification. Likes and dislikes, sense of “I” and “mine”, anxiety and calmness, elation when praised and depression when blamed - these cannot contaminate or agitate a person who has attained that state.  These opposites become balanced and are accepted with equanimity as waves on the Atmic consciousness. This is the authentic Atmic attitude, the Brahman inner-look, the unitary vision.

Motivation, Manipulation and Leadership

The word "motivation" is one that is often confused with "manipulation." Motivation occurs when you persuade someone to take an action in their own best interests.

Things like people preparing their homework, accepting responsibility for their performance and finishing their education, are the result of motivation.

Manipulation is persuading someone to take an action which is primarily for your benefit.  Things like selling an inferior product at an inflated price or working people overtime with no extra pay are examples of manipulation. Manipulation self-destructs the individual doing the manipulating.  Word gets out on manipulators and people grow less and less likely to respond in a positive manner to their manipulation.  Productivity declines.

Leadership occurs when you persuade a person to take an action which is in your mutual best interests.  Eisenhower said that leadership was the ability to persuade someone to do what you wanted them to do because they wanted to do it.  When that happens, performance improves, productivity increases, and both parties win.

Comparing motivation to manipulation is like comparing kindness to deceit. The difference is the intent of the person.  Motivation will cause people to act out of free choice and desire, while manipulation often results in forced compliance.  One is ethical and long-lasting; the other is unethical and temporary.

Carlisle said, "A great man shows his greatness by the way he treats the little man."  The value you place on people determines whether you are a motivator or a manipulator of people.  Motivation is moving together for mutual advantage.  Manipulation is persuading or even subtly coercing someone to do something so that you win and they lose.  With the motivator everybody wins; with the manipulator, only the manipulator wins.  And to that I might add that the victory is temporary and the price is prohibitive. Leaders and motivators are winners, manipulators are losers who produce resentment and discord.

We're both on the same side

One of my favourite stories concerns a young lad who was confronted by three bullies with violence in mind.  Quickly, the little guy drew a line on the ground, stepped back several feet, looked the biggest bully in the eye and said, "Now, you just step over that line."  Confidently, the big bully stepped over the line, preparing to commit mayhem on the little guy. Quickly the little fellow grinned and said, "Now we're both on the same side."

Physically, they were both on the same side.  But emotionally they were still some little distance apart.  The smaller boy improved his chances of getting on the same side emotionally by his touch of wit and wisdom.  This is an excellent combination to defuse most crisis situations and represents a major step in solving whatever problems exist.

There are several lessons parents, managers and educators can learn from this little vignette.

First, whether it is a parent/child, management/labour or teacher/student situation, both really are on the same side and the best way for either side to win is for both sides to win.

Second, a sense of humour can be very helpful in removing communications barriers by revealing your human side and establishing rapport.

Third, sometimes it's necessary for the big bully (the person in authority) to move to the other side of the table (across the line).  This lets associates, children or employees clearly understand that they really are on the same side and open to listening to ideas from both sides of that line.

The fourth message is that it is always important and to our own advantage to maintain our perspective by being open and fair-minded as we look at life from the other person's perspective.

Soon, e-payment facility at RTOs to erase middleme

In a move aimed at eliminating middlemen and removing irregularities at regional transport offices (RTOs), the state government has decided to introduce e-payment facilities for vehicle registration and driving licences, vehicle permits and fitness certificates.

According to official sources, the facility will first be introduced for registration of vehicles by dealers and then extended to payments pertaining to licences, permits and fitness certificates by the public. Transport minister K N Nehru is likely to inaugurate the system in November.

"The department has tested the software and is now making certain modifications to make it more simplified. To start with, the payments can be made through the State Bank of India's net banking services and the bank has agreed to provide zero balance account facilities to vehicle dealers who don't have an account with it. Once the system is in place, we will gradually enable the driving schools and individual applicants to make use of it," a senior transport official told The Times of India at the Secretariat.

Authorised dealers in the state have already been given identity name and password to enable them to access the transport department's website to submit applications for vehicle registration online.

"The government aims to make the RTOs cashless and paperless offices and considers the introduction of e-payment facility an important step in that direction. Soon, the system will be upgraded to enable applicants to make the payments using credit and debit cards,'' said a regional transport officer in the city.

Many vehicle users welcomed the decision but said the government should be more pro-active in ensuring that there were no middlemen at RTOs since usage of e-services depends on the computer literacy among the general public. The recently introduced facility through which vehicle users can submit applications for driving licence and get prior appointments to take learner's licence tests and driving tests has evoked a good response.

Transport department records show that about 7,500 vehicle users across the state applied for learner's licence online since August 1 and in Chennai region alone, over 3,000 people used the facility to submit learner's licence applications. Besides, driving schools in the state submitted applications online on behalf of over one-lakh applicants.