Places of Worship or Banks? : The aftermath of Demonetisation in India

Demonetisation in India has led to several repercussions – the most significant one being the religious, the pious, the falsely religious, and even a few atheists thronging to temples (places of worship). This sudden outburst of devotion did not arise as a result of Gods and Goddesses descending from the heavens to magically convert the invalid currencies into now legal tender. But something just as similar happened when devotees deposited volumes of demonetised cash into temple hundis. Estimates reveal that the Venkateswara temple at Tirupati, Andhra Pradesh alone received Rs.22.9 crores ($3.5 million) as donations in high value notes in the ten days following this move. The Sidhi Vinayaka temple in Mumbai, Maharastra received Rs.59.44 lakh ($0.09 million) and the Jagannath temple in Puri, Odisha around Rs.366,360 ($5683) in just a week. Some devotees went a step further by even exchanging high denomination currency for lower ones in temples.

Even more conveniently, the Revenue Ministry declared that deposits in temple hundis would not be subjected to tax scanning. If not for the Rs. 2.5 lakh ($3878) cash deposit limit which was introduced recently, one can almost imagine the more influential devotees depositing money in hundis and then coming back after closing time to get back their money through the back gate. One cannot assume, however, that the deposit limit solves this problem. Some “donators” (or depositors?) could just deposit cash at temples and keep withdrawing the cash at their own pace. Temples now provide “additional services”, including banking, instant cash, and exchange. The money from those who do not use the withdrawal services, of course, gets lodged in the temples.

This raises a whole new concern about what this money is used for. The Hindu culture is unique in being under the purview of the Indian government through The Hindu Religious and Charitable Endowments Act, 1997. Which means that the government decides what to do with the money coming into temples. Statistics show that a large proportion of the money goes into subsidies for pilgrimages to Haj and churches. Only around 22% of the money received by temples is retained for their maintenance and operations, which again has several hitches because this money is unaccounted for and hence accessible to anybody. This makes us wonder about the biased culture in this religion. Devotees are allowed into different areas in the temples based on how much they pay through tickets of Rs.10 (16 cents), Rs.100 ($1.55), or Rs.1000 ($15.51), but money coming into temples is diverted into pilgrimages for other religions where such discriminations are not even present.

Looking at all of this, we cannot help but wonder what kind of a mess this system has got the country into. One way to clean this up is to think about how we could get around the sentiment about opening hundis. If we cannot open the hundis, why can’t we replace them – in such a way that there would be a way to monitor high value deposits and also to make sure that the money is used for the right purposes? This could be done through the introduction of online donations and digital hundis.

There is huge potential for the concept of digital hundis, given the fact that the top 5 wealthy temples alone (including Tirupati, Padmanabhaswamy temple, and Shirdi) receive around Rs. 1629 crores ($0.25 billion) of donations annually. Making these donations online on the condition that the donator’s Aadhar card (Unique Identification Card) number has to be provided for this can ensure accounting for this money and that a larger portion of these funds is set aside for temple maintenance. Hundis at temples could be digitalised, programmed to accept only donations up to a certain limit and have slots only for specific low denomination currency notes. Two separate hundis for cash and coins could be installed, the latter serving the people who have sentiments about clinking in coins. Bigger donations can only be made online and not directly to the temple authorities. Once all this money is accounted for, it is easy to spot the black money hoarders.

Moreover, just imagining the potential of bringing in the concept of corporate social responsibility (CSR) into this scenario reveals opportunities aplenty! If the recent clause under the Companies Act to invest 2% of profit after tax is implemented for the revenue earned by temples, as well, the resulting amount can create wonders for CSR activities in at least the areas surrounding these shrines. Construction of new and better toilets, better hygiene and a clean environment in and around the temples (which incidentally also contribute to the aim of a clean India by 2019), construction of brick-and-mortar houses to replace the huts in which the people who serve the temple live in, laying better approach roads to temples…the list is endless.

Implementing these ideas as pilot projects at least across the major temples in India could really give a hope to the poor and the middle class by ensuring that the hard-earned money they deposit is really used for divine purposes – after all, service to humankind and temples open to all without bias are the greatest forms of Godliness.

Neharika Rajagopalan, MSc Economics Batch (2012-13)

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