In India, the digitalization has taken place after Covid Pandemic, now almost everyone uses UPI payment from a vegetable seller to a big restaurant owner. Th payments number has surpassed that of China and US too. But still there is a parallel economy which is rely only on cash. When the cash becomes more and if the government do not know about the source then it becomes a black money.
PC: Pixabay.com
The current government had banned some currency notes 5 years before bit that did not solved the problem. Mainly this cash economy us prevalent in real estate. If you are buying a flat and taking loan then the bank will deal with the money and that will be bank to bank transfer and there is minimum or even no black money evolved. But if you are dealing with land then the rates which the seller ask is more than twice or thrice then the market price and people are willing to pay that amount because they want the land.
So for the government record you have to pay that amount which is the rare fixed by government and the remaining you have to pay by cash to the seller. Now this amount for you it is white money but for the seller it becomes a black money and he do not have to pay any tax on it. And the government do not know about it and a parallel economy gets created from that cash. Similarly just like the above example, there is a lot of bribe we Indians have to pay to get something done and this bribe is again the black money.
The governments around the world argues that Crypto will make the economy worse, but I think the Cash economy is actually breaking the bone of the current economy. Though there are raids done on High Net Individuals but what about those who have created their empire on taking bribes.
Also the people who are taking bribes are the culprit for the cash economy but it's actually the people who are giving it. But we can argue that we cannot have our work done until and unless we pay the bribe and that it's true. Recently I have been caught by the traffic police to pay the fine of Rs 1000 for having expired emission test report. I got away by paying only Rs 200. Now this Rs 200 is gone in the pocket of the police officer. For me I have saved Rs 800 but again I am at fault on creating the parallel economy.