Cash On Hand In The Public Is At A Record High Of 30.88 Lakh Crore Six Years After Demonetization
A new high of 30.88 lakh crore in currency held by the public as of October 21 shows that cash usage is still strong even six years after the decision to implement demonetization.
The public’s money is now 71.84% higher than it was for the fortnight that ended on November 4, 2016, at Rs. 30.88 lakh crore. The withdrawal of the 500 and 1,000 denomination notes was announced by Prime Minister Narendra Modi on November 8, 2016, with the ultimate goal of decreasing corruption and black money in the economy.
The move was intended to make India a less cash economy, while many experts criticized it for having been poorly planned and carried out.
The cash with the public climbed to 30.88 lakh crore as of October 21 according to the fortnightly data on money supply that the RBI provided on November 4. On November 4, 2016, the Reserve Money data from the central bank indicated that there were 17.7 lakh crores of dollars in circulation.
Notes and coins used by people to conduct business, complete trades, and make purchases of goods and services are referred to as currency by the public. The sum is calculated after subtracting bank cash from the amount of money in circulation.
Despite the rise in popularity of newer, more convenient digital payment methods, the economy has seen a steady increase in the use of cash. Such digital modes also received a boost from the COVID-19 pandemic, which placed an emphasis on contactless transactions.
A 2019 RBI research on digital payments addressed the problem in part.
It stated that despite India’s historically low ratio of digital payments to GDP, the country has seen a huge growth in digital transactions since demonetization.
According to a recent note from SBI economists, excluding the 2009 celebrations, which saw a slight decline because of the global financial crisis, the currency in circulation (CIC) decreased by 7,600 crores during Diwali week. This was the first decline of this magnitude in nearly two decades.
News Mania Desk
