Five years after note ban, cash in use now at record 14.5% of GDP


 

MUMBAI: The ratio of currency in circulation as 

a proportion of GDP touched a new high of 

14.5% for fiscal 2020-21. The surge came as the 

pandemic increased the demand for cash and shrunk the GDP. 


At the same time, the surge in every form of 

digital payments continues on the fifth 

anniversary of demonetisation — whether it is 


Unified Payments Interface


 (UPI), credit and debit cards or FASTag — 

demonstrating that the shift to digital as well as 

cash intensity are not mutually exclusive.



The post-pandemic increase in currency in 

circulation has been a global phenomenon, 

described as a ‘dash to cash’ under extreme 

uncertainty. This has been experienced by the 

US, Spain, Italy, Germany, France, Brazil, Russia and Turkey.



Meanwhile, digital payments are nearly three 

times what they were in FY18. The Reserve Bank 

of India’s digital payments index, which has 2018 

as the base year at 100, has risen to 270. This 

index also captures the spread of digital, taking 

into account growth in the payments 

infrastructure.








Post a Comment

Previous Next

Join Us

Now you can share news articles on the blog, contact us

نموذج الاتصال