Economy Fence – Shock To Digital India In Economy! Cash Usage Hits Record High – The use of money within the country has gone up to 14.7 per cent of GDP during the fiscal year 2020-21, which may be a record till date. The cash-GDP ratio was very low within the year of demonetisation and has been increasing since then.
Economy Fence – Shock To Digital India In Economy! Cash Usage Hits Record High
The Modi government is trying to form the Indian economy more and more digital. But recently the figures released by the Federal Reserve Bank seem to be hurting this campaign tons . the utilization of money within the country has gone up to 14.7 per cent of gross domestic product (GDP) during FY 2020-21, a record thus far .
In the year of demonetisation, the cash-GDP ratio was very low and then it’s increased. This has been revealed by the annual report of the Federal Reserve Bank of India. consistent with the report, before this, the ratio of money and GDP has always been but 12 percent.
In 2016, when Prime Minister Narendra Modi announced the ban on demonetisation within the country, then the government’s effort was to attenuate the utilization of money within the country and increase digital transactions. an effort was made to extend the transaction through online transaction, card, UPI.
Ratio was reduced thanks to demonetisation
Due to demonetisation, the cash-to-GDP ratio was just 8.67 percent within the fiscal year 2016-17. But this decline proved to be of short duration. within the year 2019-20, the cash-GDP ratio rose to 12.03 percent. Now it’s reached the record level.
One reason for the rise within the cash-GDP ratio is that within the year 2020-21, the trend of money has increased by 17.2 percent, compared to 14 percent a year ago. Before demonetisation, the entire take advantage circulation within the country was Rs 16.63 lakh crore, which increased to Rs 28.60 lakh crore in 2020-21. On the opposite hand, thanks to Kovid within the year 2020-21, there has been a big decline in GDP. Experts estimate that the cash-GDP ratio will remain high for a few time.
500 notes highest
According to the Federal Reserve Bank , out of the currency notes in circulation, the very best 31.1 per cent is of the Rs 500 note. After this, 10 notes with 23.6 percent share are in second place.