My letter to the Honorable Finance Minister, Shri Arun Jaitley suggesting a ‘Janta Credit Card’ to eliminate black money

Date: January 27, 2015

Shri Arun Jaitley
The Honorable Finance Minister
Ministry of Finance
Department of Economic Affairs
North Block
New Delhi


Respected Sir,

Sub: A ‘Janta Credit Card’ to eliminate black money from the economy

Your recent assurances that you plan to make the tax system more transparent and taxpayer-friendly are heartening. Your inviting people to send their suggestions ahead of the union budget also comes across as a very inclusive step.

I’m writing to you with a suggestion on how you can eliminate black money from the system by introducing a credit card for the people of our country. Right now, several banks offer unsecured credit cards to people and charge up to 36% per annum as interest when they provide credit to the account holder for purchases made using the credit card. These are usurious rates of interest especially when the same banks gladly lend money at 14-15% to the same account holder for buying a two-wheeler. We must have lower interest rates for borrowers with a good credit history, rated by CIBIL (Credit Information Bureau Limited).

It is in the interest of the nation to see that people have access to credit cards that offer credit at reasonable rates. When this happens, more and more people will own and habitually use credit cards. The boom in the US during the 1950s and 60s was driven by consumption. We can have a similar consumption-led boom here. This will also mean an expansion of production and economies of scale will result in a lower cost of production and generate employment. This will make our country more competitive in the international market. We will be better able to compete with Chinese goods within and outside our country. By encouraging credit cards at reasonable rates of interest, we may also be able to counter black money. Today a salaried person who has dinner out with his or her family often doesn’t leave with the restaurant’s bill. Restaurants often tear up or modify the bills to under-report sales. This causes losses of not only direct taxes but also indirect taxes such as VAT (Value added tax) and service tax. When credit cards are widely used, this malicious practice will be curtailed. The tax revenue generated will also indirectly help infrastructure growth.

The government, on its part, must consider offering a credit card; a ‘Janta Credit Card’ via the public sector banks such as The State Bank of India. These credit cards can be backed by a fixed deposit or a personal guarantee, making the risk of default minimal. The lending rate can be very close to the bank’s deposit rates. With this, the penetration of credit cards will increase exponentially. There are many small traders who deal only in cash and issue little worthless slips of paper as invoices and receipts. Greater usage of credit cards will make it very difficult for such small traders, small retailers and restaurants to conceal transactions and evade taxes, thereby sharply increasing the direct and indirect tax collections.

My best wishes for your union budget.


Best regards,


Vikkramm Chandirramani
CEO, Quest Mercury Intermedia Private Limited

Pictured above: Shri Arun Jaitley at the World Economic Forum’s India Economic Summit 2010 held in New Delhi, 14-16 November 2010