Adoption of Cashless Transaction by the Farming Households in Coimbatore District of Tamil Nadu, India

Abstract

Aims: The research study aims to study the level of adoption and factors influencing the adoption of cashless transaction by the farming households in farming and non-farm activities. Study Design and Methodology: A development index for Tamil Nadu districts, prioritizing e-infrastructure, was crafted from secondary data on agriculture, health, infrastructure, and telecommunication. Coimbatore, with a high development index, was selected using a three-stage stratified random sampling approach involving 120 households. Utilizing tools like the development index, econometric models, scoring/ranking techniques, and non-market valuation methods, values ranged from 0 to 1, indicating low to high development. An adoption index classified respondents into low, medium, high, and very high adopters, evaluating cashless transaction adoption. The logit model pinpointed factors influencing cashless transaction adoption among farm households. Results and Conclusion: This study shows a gradual shift towards cashless transactions among farmers, primarily driven by government policies promoting bank account usage for subsidies and loans. In Coimbatore, a developed district in Tamil Nadu, the adoption index is 63 per cent for non-agricultural and 44 per cent for agricultural transactions, highlighting a significant difference. The slow adoption is attributed to incomplete sales portal transformation and farmers' limited awareness of online platforms for input purchases. Despite challenges, farmers exhibit a positive attitude, emphasizing the importance of addressing issues such as financial literacy, internet connectivity, and infrastructure for successful cashless transactions.